Methodological Reflections on the Short-Run Johansen Industry Model in Relation to Capacity Management
AbstractThe specification of a convex production technology is a potential issue in estimating firm-level Johansen plant capacity utilisation rates and their subsequent use in the short-run Johansen industry capacity model of the fishery. There are different plant capacity utilisation estimates with convex and nonconvex technologies. When entered as parameters in the short-run Johansen industry model, this leads to different distributions in the activity vectors. With non-convex technology, more vessels remain active in the fleet, and there is no longer an overestimation of the number of decommissioned vessels compared to the use of a convex technology. A second methodological reflection involves a way to trace the evolution of capacity over time and the possibility of formulating multi-period, short-run Johansen industry models using appropriate discrete time Malmquist productivity indices. Danish vessels provide an illustration for the convexity issue.
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Bibliographic InfoArticle provided by Marine Resources Foundation in its journal Marine Resource Economics.
Volume (Year): 20 (2005)
Issue (Month): 4 ()
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Web page: http://www.uri.edu/cels/enre/mre/mre.htm
Convexity; plant capacity; short-run Johansen industry model; Malmquist productivity index; Danish vessels; vessel decommissioning; D24; Q22; Resource /Energy Economics and Policy;
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
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