A Dual Production Analysis of a Multispecies Fishery: The Case of the U.S. Atlantic Longline Fleet

Abstract

The harvest technology of several multispecies fisheries has been explained in the recent literature using dual-based models. These studies are useful for explaining rent dissipation, estimating input and output elasticities, as well as describing other aspects of fisherman behavior. Most of these analyses have assumed that inputs are fixed at the trip level. Consequently researchers have argued that firms participating in multiple fisheries behave as revenue-maximizers. This paper describes an empirical model of a multispecies fishery that assumes decision-makers are cost-minimizers at the trip level. A theoretical argument justifying this assumption is presented. Using duality theory, optimal input demands are estimated using data from the U.S. Atlantic pelagic longline fleet using iterative seemingly unrelated regression (SUR) and a recently suggested approach. These results are used to describe the economic characteristics of the industry and the economic consequences of proposed regulations, with focus on the demand for fuel. Additionally, an EM (Expectation-Maximization) algorithm is employed to correct for missing data problems. The efficiency of the algorithm is explored by rerunning the original analysis using the newly created data set and comparing results. (Click here for paper)

Source: Perruso, L. and S. Larkin. 2002. “A dual production analysis of a multispecies fishery: the case of the U.S. Atlantic longline fleet.” In: Proceedings of the Eleventh Biennial Conference of the International Institute of Fisheries Economics & Trade: Fisheries in the Global Economy, August 19-22, 2002, Wellington, New Zealand. Corvallis, OR: International Institute for Fisheries Economics and Trade (IIFET).

For more information, please contact: Larry.Perruso@noaa.gov