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Estimating Heterogeneous Primal Capacity and Capacity Utilization Measures in a Multi-Species Fishery

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  • Felthoven, Ronald G.
  • Horrace, William C.
  • Schnier, Kurt E.

Abstract

We use a stochastic production frontier model to investigate the presence of heterogeneous production and its impact on fleet capacity and capacity utilization in a multi-species fishery. Furthermore, we propose a new fleet capacity estimate that incorporates complete information on the stochastic differences between each vessel-specific technical efficiency distribution. Results indicate that ignoring heterogeneity in production technologies within a multi-species fishery, as well as the complete distribution of a vessel’'s technical efficiency score, may yield erroneous fleet-wide production profiles and estimates of capacity.

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Bibliographic Info

Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2006 Annual meeting, July 23-26, Long Beach, CA with number 21276.

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Date of creation: 2006
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Handle: RePEc:ags:aaea06:21276

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Keywords: Resource /Energy Economics and Policy;

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  1. Smith, Martin D., 2005. "State dependence and heterogeneity in fishing location choice," Journal of Environmental Economics and Management, Elsevier, vol. 50(2), pages 319-340, September.
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  3. Luis Orea & Subal C. Kumbhakar, 2004. "Efficiency measurement using a latent class stochastic frontier model," Empirical Economics, Springer, Springer, vol. 29(1), pages 169-183, January.
  4. Anderson, Christopher M. & Putterman, Louis, 2006. "Do non-strategic sanctions obey the law of demand? The demand for punishment in the voluntary contribution mechanism," Games and Economic Behavior, Elsevier, vol. 54(1), pages 1-24, January.
  5. Horrace, William C., 2005. "On ranking and selection from independent truncated normal distributions," Journal of Econometrics, Elsevier, Elsevier, vol. 126(2), pages 335-354, June.
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  7. Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, Elsevier, vol. 126(2), pages 269-303, June.
  8. Tom Kompas & Tuong Nhu Che, 2003. "Efficiency Gains and Cost Reductions from Individual Transferable Quotas: A Stochastic Cost Frontier for," International and Development Economics Working Papers, International and Development Economics idec03-6, International and Development Economics.
  9. Kenneth E. Train, 1998. "Recreation Demand Models with Taste Differences over People," Land Economics, University of Wisconsin Press, vol. 74(2), pages 230-239.
  10. Kurt E. Schnier & Christopher M. Anderson & William C. Horrace, 2006. "Estimating Heterogeneous Production in Fisheries," Center for Policy Research Working Papers, Center for Policy Research, Maxwell School, Syracuse University 80, Center for Policy Research, Maxwell School, Syracuse University.
  11. Fare, Rolf & Grosskopf, Shawna & Kokkelenberg, Edward C, 1989. "Measuring Plant Capacity, Utilization and Technical Change: A Nonparametric Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 30(3), pages 655-66, August.
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  13. Tom Kompas & Tuong Nhu Che & R. Quentin Grafton, 2003. "Technical Efficiency Effects of Input Controls: Evidence from Australia's Banana Prawn Fishery," Economics and Environment Network Working Papers, Australian National University, Economics and Environment Network 0304, Australian National University, Economics and Environment Network.
  14. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, Elsevier, vol. 6(1), pages 21-37, July.
  15. Schnier, Kurt E. & Anderson, Christopher M., 2006. "Decision making in patchy resource environments: Spatial misperception of bioeconomic models," Journal of Economic Behavior & Organization, Elsevier, vol. 61(2), pages 234-254, October.
  16. James E. Kirkley & Dale Squires & Mohammad Ferdous Alam & Haji Omar Ishak, 2003. "Excess Capacity and Asymmetric Information in Developing Country Fisheries: The Malaysian Purse Seine Fishery," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, Agricultural and Applied Economics Association, vol. 85(3), pages 647-662.
  17. Catherine J. Morrison Paul & Warren E. Johnston & Gerald A. G. Frengley, 2000. "Efficiency in New Zealand Sheep and Beef Farming: The Impacts of Regulatory Reform," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 325-337, May.
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