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Downward Adjustments in a Cyclical Environment: The Case of Chilean Pelagic Fisheries

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Author Info
Julio Peña-Torres () (ILADES-Georgetown University, Universidad Alberto Hurtado)
Michael Basch () (Universidad de Chile)
Sebastian Vergara () (CEPAL)

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Abstract

Often the scale of production of many industrial fisheries in the world shows rigidity vis à vis declines in fish abundance, which on occasions has generated fishing collapse. This paper studies the two fisheries with the greatest volume of landings in Chile, and which are also characterized by strong variability in their abundance. Production-side aspects that affect the incentives to adjust towards lower fishing efforts are analyzed. To do so, production functions for industrial fleets at each fishery are estimated by resorting to panel data. Two main results are obtained. First, we confirm the empirical relevance of Translog harvest technologies. This contradicts a frequent practice in bioeconomic models, which considers harvest-inputs elasticities as being constant and independent from the scale of production. Second, a set of production-side effects are identified that weaken the incentives to adjust towards lower fishing efforts: increasing returns in the use of variable inputs, which are also strengthened by external economies associated to the aggregate searching effort for fish, and catch yields sensitive to changes in abundance, but where the strength of this effect decreases as abundance declines.

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Paper provided by Ilades-Georgetown University, School of Economics and Bussines in its series ILADES-Georgetown University Working Papers with number inv143.

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Handle: RePEc:ila:ilades:inv143

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  1. Socio-economics of Fisheries and Aquaculture
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  4. Bjorndal, Trond, 1988. "The optimal management of North Sea Herring," Journal of Environmental Economics and Management, Elsevier, vol. 15(1), pages 9-29, March. [Downloadable!] (restricted)
  5. Hausman, Jerry A, 1978. "Specification Tests in Econometrics," Econometrica, Econometric Society, vol. 46(6), pages 1251-71, November. [Downloadable!] (restricted)
  6. Tracy R. Lewis & Richard Schmalensee, 1979. "Non-convexity and Optimal Harvesting Strategies for Renewable Resources," Canadian Journal of Economics, Canadian Economics Association, vol. 12(4), pages 677-91, November. [Downloadable!] (restricted)
  7. Davidson, Russell & MacKinnon, James G, 1981. "Several Tests for Model Specification in the Presence of Alternative Hypotheses," Econometrica, Econometric Society, vol. 49(3), pages 781-93, May. [Downloadable!] (restricted)
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  8. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May. [Downloadable!] (restricted)
  9. Beddington, John R & Watts, C M K & Wright, W D C, 1975. "Optimal Cropping of Self-Reproducible Natural Resources," Econometrica, Econometric Society, vol. 43(4), pages 789-802, July. [Downloadable!] (restricted)
  10. Hausman, Jerry A. & Taylor, William E., 1981. "Panel data and unobservable individual effects," Journal of Econometrics, Elsevier, vol. 16(1), pages 155-155, May. [Downloadable!] (restricted)
  11. Bhargava, A & Franzini, L & Narendranathan, W, 1982. "Serial Correlation and the Fixed Effects Model," Review of Economic Studies, Blackwell Publishing, vol. 49(4), pages 533-49, October. [Downloadable!] (restricted)
  12. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July. [Downloadable!] (restricted)
  13. Hausman, Jerry A & Taylor, William E, 1981. "Panel Data and Unobservable Individual Effects," Econometrica, Econometric Society, vol. 49(6), pages 1377-98, November. [Downloadable!] (restricted)
  14. Bjorndal, Trond, 1987. " Production Economics and Optimal Stock Size in a North Atlantic Fishery," Scandinavian Journal of Economics, Blackwell Publishing, vol. 89(2), pages 145-64.
  15. Baltagi, Badi H. & Boozer, Michael A., 1997. "Econometric Analysis of Panel Data," Econometric Theory, Cambridge University Press, vol. 13(05), pages 747-754, October. [Downloadable!]
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