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Economics & Social Sciences Research Program

Research Proposals Funded for 2006

The ESSR Program successfully competed for research funds from NOAA Headquarters for five research projects:

Proposal 1:  Spatial Economic Performance: Regulation-Induced Changes in Fishing Location and Practices in the Alaskan Pollock Fleet. Current research at the AFSC has focused on evaluating the impacts on economic performance of the implementation of the American Fisheries Act (AFA) on the Bering Sea and Aleutian Islands (BSAI) pollock fishery. This research has resulted in an article on harvesting productivity and an ongoing study on processing productivity (including product choice and quality) in this fishery.

Our analyses have identified important changes in the BSAI fishery structure since the AFA that may involve not only direct impacts of the Act, but also of concurrent regulations such as prohibitions on bottom trawling and fishing location. A combination of such regulatory factors has affected fishing productivity and revenues through adaptations in fishing strategies and practices, including fishing speed and thus the quality of the catch and choice of final products. Specifically, the AFA likely affected how fishers fish and the area closures where they fish, both of which affect the productivity and revenue of the fishery.

The proposed research will focus on disentangling the effects of regulatory changes on economic performance of the BSAI fishery, with particular attention to the impacts of fishing area closures for the protection of Steller sea lion habitat. These commercial fishing restrictions in the Steller sea lion Conservation Area (SCA) are designed to increase Steller sea lion populations by protecting the fish on which they prey. However, they also may have had effects on fishery productivity through restricted location choices, greater travel distances, and increased density of fishing in the remaining areas. This research will measure such impacts using parametric models of optimal catch or revenues that can directly represent, both within the estimation model and the stochastic structure, the impacts of regulatory factors on productivity and economic returns. The research will thus result in productivity measures that embody both direct regulatory impacts and indirect externalities from other boats' fishing choices.

Proposal 2:  Community Development Quota Price Analysis. The Western Alaska Community Development Quota Program (CDQ Program) has operated in Alaskan communities since it was developed in 1992. The CDQ Program was created to ensure that communities in the Bering Sea region share in the wealth created by their fisheries. In many cases, quota holders in rural communities have leased their CDQ Program quotas to large commercial fishing companies to exploit cost economies of scale. The information detailing these transfers has been recorded in reports that community development corporations are required to file during each year with NMFS and the state of Alaska.

In particular, these reports contain a large amount of historical data on the prices that have been paid for the opportunity to fish in different fisheries. In some cases, the prices reflect the opportunity to fish in areas, and/or during times of the year, for which only CDQ fishing was authorized. These data therefore provide important information on the rents generated in Alaskan fisheries, and may allow us to answer various questions that, until now, could not be answered with available data.

NMFS uses temporal and spatial closures to help improve the biological health and economic performance of Alaskan fisheries. In many cases, it is very difficult or impossible to assess the value of these closures. A careful examination of the information in the CDQ Program reports will provide us with new and valuable insight into the relative values of fishing in different areas. By observing the changing lease rates across time, these data will also allow us to better quantify the value added in the pollock fishery with the imposition of the AFA.

In addition, economists at the AFSC have worked to measure the costs of marine reserves and other area closures. The data from the CDQ program will also complement this research. This information is more pertinent than ever as NMFS moves towards ecosystem management which will require that we make additional trade-offs across space and time.

The NMFS CDQ Program Coordinator, Sally Bibb, has expressed enthusiastic support for this project. The reports submitted by the community development corporations (Communities) contain a variety of information about the transfer of fishing rights. The information contained includes audited financial statements and the contracts between the Communities and commercial fishing companies, but this information is not recorded in a common format in the different reports. In addition to the economic goals of the project, we will help to identify the common features of the reports and provide input to the Alaska Region on how to standardize the data collected in the future.

Proposal 3:  Estimating Interregional Economic Impacts of Vessels Participating in Both Alaska Fisheries and Fisheries off the West Coast. Many of the vessels operating in Alaska fisheries are owned and crewed by residents of Washington and Oregon. Some of these vessels also participate in West Coast fisheries during the year. While much of the income earned by these vessels leaves Alaska, expenditures made elsewhere will generate positive economic impacts for that region and may also have spillover effects.

Previous research has demonstrated that assuming all commodities and services are locally supplied will significantly overestimate regional impacts. Understanding the location of expenditures made by these vessels, both in Alaska and elsewhere, will enhance our understanding of the overall economic impacts of Alaskan fisheries.

Standard regional economic models focus on a single region. These models generally fail to capture economic impacts transmitted outside that region, and also do not account for spillover effects in the study region resulting from events occurring outside. An inter-regional or multiregional model can more fully measure the impacts of a region's fisheries, including those impacts occurring in regions that supply commodities or factors of production to industries in the study region, or that demand the goods and services produced there.

An inter-regional model would be especially useful in the case of Alaska, where most intermediate goods are imported and much of the factor income leaks out of the region to nonresident vessel owners and crew members. This type of model could also be used to track the impact of expenditures by vessel owners and crew members who are also active in other regions' fisheries. However, developing an inter-regional model involves the daunting task of estimating inter-regional flows of commodity inputs and factor services. Acquiring this information has traditionally been very challenging due to an absence of interregional trade flow statistics.

Proposal 4:  Measures of Technical Efficiency and Their Impact on Spatial Regulatory Measures.The production function framework used to characterize production processes in nonfishery technologies fails to incorporate many of the spatial characteristics of fishing vessels that use inputs to create fish outputs: their production functions are highly mobile. This level of mobility implies that their production functions are not only defined by the technology they possess and the inputs they utilize but also by the location in which they employ them. Therefore, previous research conducted on the level of technical efficiency possessed by vessels within a fishing fleet ignores one of the most important inputs of production: where they chose to fish.

The purpose of this research is to estimate the spatial technical efficiency of trawl vessels operating within the Bering Sea and Aleutian Islands within the regions potentially closed under proposed essential fish habitat (EFH) alternatives and to determine whether or not the proposed closures will have a deleterious effect on their production processes.

Proposal 5:  Recreational Fishing Demographics in Alaska. The two most important saltwater recreational fisheries in Alaska are halibut and salmon. Of these, the halibut fishery is managed by the North Pacific Fishery Management Council, which has been debating instituting a controversial Guideline Harvest Level and limited allocation for the sector. Available information about the recreational fishermen who will be affected is limited.

This project will analyze data which has been collected by NMFS, but which remains unprocessed, to create a demographic description of the participants in Alaska's saltwater recreational fisheries. Recreational license information for Alaska has previously been analyzed by AFSC scientists for data on community of residence and place of license purchase. But the value of this database is limited because demographic information is not requested on the license application.

In 2004, AFSC economists conducted a nationwide mail survey of people who had purchased recreational fishing licenses in Alaska the previous year. Six demographic questions were included in this survey: age, gender, race/ethnicity, education, household size, and income. This data is a unique window onto participants in Alaska's recreational fisheries just at the time when the Council is considering policies which will affect this otherwise undescribed group.

By Ron Felthoven
 

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