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Assessing Changes in Capital and Investment as a Result of Fishing Capacity Limitation Programs

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  • Ikerne Valle Erkiaga
  • Kepa Ikazuriaga

Abstract

This paper provides a framework to evaluate the effectiveness of the European Multiannual Guidance Programmes on capacity limitation based on the evolution of the prices of used fishing vessels and on the measures of capital and investment derived from the estimation of a hedonic price function related to vessels characteristics. Attention is paid not only to the correct specification of the numerical variables but also, to testing for sample selection bias, to checking for structural change, to analysing the convenience of using alternative estimation methods and to discussing the potential bias as a result of asymmetric information in the used markets. The application of this framework to the Basque fleets evidences clear and coincident signs of successful adjustment after MAGP 3 , but also a substantial investment in the next periods as a result of the modernisation of the fleets. Copyright Springer Science+Business Media B.V. 2013

Suggested Citation

  • Ikerne Valle Erkiaga & Kepa Ikazuriaga, 2013. "Assessing Changes in Capital and Investment as a Result of Fishing Capacity Limitation Programs," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(2), pages 223-260, February.
    • Handle: RePEc:kap:enreec:v:54:y:2013:i:2:p:223-260
    DOI: 10.1007/s10640-012-9591-1
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    More about this item

    Keywords

    European fisheries policy; Capacity limitation programs; Multi annual guidance programmes (MAGPs); Hedonic price modelling; Model selection procedure; Basque fleet; Q22; (R33; C21; C43; E31; L62);
    All these keywords.

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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