Increasing Returns and Cycles in Fishing

Tilburg University, CentER Working Paper No. 2000-57

27 Pages Posted: 20 Oct 2000  

Matti Liski

Aalto University - Department of Economics

Peter M. Kort

Tilburg University - Department of Econometrics & Operations Research; Tilburg University - Center for Economic Research (CentER)

Andreas J. Novak

University of Vienna - Department of Statistics and Decision Support Systems

Date Written: June 2000

Abstract

We consider optimal fishery management under the assumption of increasing returns that is supported by previous empirical evidence. We improve the tractability and realism of the previous approaches by introducing flow adjustment costs on changes in harvest rate. Our framework is the first to provide a link between stable limit cycle policies and increasing returns in harvesting. The type of the harvest policy depends on flow adjustment costs: for relatively costly adjustments the usual steady state harvest policy is conceivable, whereas for relatively cheap adjustments the harvest policy is cyclical. We also show a connection between chattering control policies and limit cycles, which helps us to develop a clear economic meaning for cyclical harvesting.

Keywords: Nonconvexities, Adjustment costs, Hopf bifurcation, Renerable resources

JEL Classification: C61, C62

Suggested Citation

Liski, Matti and Kort, Peter M. and Novak, Andreas J., Increasing Returns and Cycles in Fishing (June 2000). Tilburg University, CentER Working Paper No. 2000-57. Available at SSRN: https://ssrn.com/abstract=246957 or http://dx.doi.org/10.2139/ssrn.246957

Matti Liski (Contact Author)

Aalto University - Department of Economics ( email )

PO Box 1210
FI-00101 Helsinki
Finland
+358-9-43138384 (Phone)
+358-9-43138735 (Fax)

HOME PAGE: http://www.hkkk.fi/~liski

Peter Kort

Tilburg University - Department of Econometrics & Operations Research ( email )

Tilburg, 5000 LE
Netherlands
+31 13 466 2062 (Phone)
+31 13 466 3072 (Fax)

HOME PAGE: http://center.uvt.nl/staff/kort/

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 2062 (Phone)
+31 13 466 3072 (Fax)

Andreas J. Novak

University of Vienna - Department of Statistics and Decision Support Systems ( email )

Universitaetsstr. 5
Vienna, A-1010
Austria

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