Chapter

The Basic Dynamic Economic Model of the Fishery

Trond Bjørndal and Gordon R. Munro

in The Economics and Management of World Fisheries

Published in print October 2012 | ISBN: 9780199576753
Published online January 2013 | e-ISBN: 9780191745973 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199576753.003.0003
The Basic Dynamic Economic Model of the Fishery

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This chapter provides two empirical applications based on the dynamic economic model of the fishery introduced in chapter 3, namely for the Western Channel sole fishery and the North Sea herring fishery. For both fisheries, it is assumed that they are managed by a resource manager whose objective is to maximise the present value of net economic benefits from the fishery. As pointed out in chapter 3, a resource manager is faced with two main questions, namely: determining i) the optimal stock level and ii) the optimal rate of investment in the stock. The emphasis in the case studies is on the first question, although the second is also addressed. In the analysis, discrete time dynamic bioeconomic models, where time is specified in years for the empirical applications, are developed. This is natural, based on relevant characteristics of the fisheries in question. Moreover, only annual data are available. For herring, the recruitment function includes a time lag. For both fisheries, optimal stock level and associated harvest are estimated under different assumptions, and policy implications are discussed.

Keywords: Western Channel sole; North Sea herring; bioeconomic model; delay difference model; optimal stock level; optimal harvest level

Chapter.  15115 words.  Illustrated.

Subjects: Economic Development and Growth

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