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Economics & Social Sciences Research Program

Decomposing Productivity and Efficiency Changes in the Alaska Head and Gut Factory Trawl (Amendment 80) Fleet

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Spring 2015
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Fishing fleets are subject to numerous factors that affect economic performance, making identification and attribution of such impacts difficult. This study extends a previous study on productivity change in U.S. Catch share fisheries and focuses specifically on the Amendment 80 fleet. The approach separately identifies the effects of changing input and output prices, fishery management, and quota allocations on total factor productivity using a Lowe Index. Indices account for technical change and decompose efficiency estimates into its technical, environmental, and scale-mix components. This results in measures that reflect shifts in the production frontier, and movements by vessels toward and around the frontier, to capture economies of scale and mix after a policy shift to a catch share program that includes fishing cooperatives and a limited access fishery. We exploit the difference between cooperative and limited access vessels to compare the changes in economic performance between the groups after the introduction of catch shares and cooperative management, which allowed the vessels to improve the timing and coordination across multi-species fisheries and to decrease incidental catch of quota-limited bycatch species that had closed the target fisheries prematurely in the past.

Results indicate that total factor productivity increased significantly after the move to the catch share program, largely due to increases in technical change that shifted out the production frontier of the fishery. There are several characteristics of the Amendment 80 Program that may help provide context for the increase in total factor productivity. First, allocating catch shares has eliminated the race for fish, and could have subsequently reduced fishing costs, particularly fuel use which dropped 15% from the first year after implementation, 2008, through 2012. Second, the cooperative structure of the Amendment 80 Program could be improving communication among cooperative members and reducing search costs. Third, Amendment 80 provided additional flexibility for vessels to meet the halibut prohibited species catch (PSC) limits and likely had a significant impact on each member vessel’s ability to increase their catch and remain below the PSC limit.

These results provide support to the notion that the Amendment 80 program had positive effects on the productivity of the fleet. Increases in productivity have occurred even after accounting for changes in output price, input use and costs, and quota allocations. A manuscript summarizing the results of this study is forthcoming in a special issue of Marine Policy on Productivity Change in Commercial Fisheries.

By Ben Fissel, Ron Felthoven, Stephen Kasperski, and Chris O’Donnell



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