NOAA Technical Memorandum NMFS NE 119
Data Needs for Economic
Analysis
of Fishery Management
Regulations
by Andrew W. Kitts and Scott
R. Steinback
National Marine Fisheries Serv., Woods Hole Lab., 166 Water St., Woods
Hole, MA 02543
Print
publication date August 1999;
web version posted December 18, 2000
Citation:
Data Needs for Economic
Analysis of Fishery Management
Regulations
Information Quality Act Compliance: In accordance with section 515 of Public Law 106-554, the Northeast Fisheries Science Center completed both technical and policy reviews for this report. These predissemination reviews are on file at the NEFSC Editorial Office.
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INTRODUCTION
Justification
Executive Order 12866 signed by President Clinton on September 30, 1993,
directs regulatory agencies to evaluate, among other things, economic
consequences of proposed fishery management regulations and to choose
regulatory measures that maximize net
national benefits1:
In deciding whether and how to regulate, agencies should
assess all costs and benefits of available regulatory alternatives,
including the alternative of not regulating. Costs and benefits
shall be understood to include both quantifiable measures (to the fullest
extent that these can be usefully estimated) and qualitative measures
of costs and benefits that are difficult to quantify, but nevertheless
essential to consider. Further, in choosing among alternative
regulatory approaches, agencies should select those approaches that
maximize net benefits (including potential economic, environmental,
public health and safety, and other advantages; distributive impacts;
and equity), unless a statute requires another regulatory approach (President
1993).
The Fishery Conservation and Management Act of 1976 (also referred to
as the Magnuson Act) also calls for managers to “promote efficiency in
the utilization of fishery resources” (Fishery Conservation and Management
Act of 1976), where efficiency is viewed by economists to mean economic
efficiency, i.e., maximizing the net national benefits
or net economic value from
a fish resource2. At
a minimum, the National Marine Fisheries Service’s (NMFS) “Guidelines
on Regulatory Analysis of Fishery Management Actions” (NMFS 1995), which
guides the regulatory impact review (RIR) process of fishery management
plans (FMP), calls for “a full qualitative analysis of expected incremental
benefits and costs” from a management alternative.
While all of these regulatory actions focus on evaluating economic consequences
of fishery management alternatives, specific economic data needed to
meet national efficiency goals have not been identified3. This
document identifies and delineates the overall economic data needed for
management of living marine resources; it is intended to help achieve
an understanding and coordination of the economic data necessary to capture
immediate and long-term consequences of management actions. This
document does not suggest an implementation strategy for data collection,
prioritize data needs, or account for the cost of data collection. While
these are topics worthy of discussion, our efforts focus exclusively
on identifying economic data needs.
Goals
Collection of the data items illustrated in this document are required
to achieve three fundamental goals:
- To understand the value of the resource and to recognize
its importance to the economy and users. This involves
describing and enumerating ways in which benefits are derived from
the resource,
measuring capital and labor devoted to those uses, determining the
importance of resource use to various users, and describing institutions
surrounding those uses.
- To measure the flow of net benefits
derived from various uses and to understand how those benefits are
generated. This entails technically describing productive
activities (i.e., inputs, processes, outputs) in their temporal
and spatial setting, measuring costs and benefits (e.g., consumer
benefits, industry income) in each transformation, and determining
the decision processes of producers.
- To preserve, conserve,
enhance, and improve the flow of net benefits from the endowment. This
requires utilizing information derived from the above efforts and
other information to seek ways to improve the flow of net benefits
by reducing
costs, defining constraints on use, evaluating tradeoffs among uses,
designing improved allocations (or establishing systems that will, e.g.,
markets), defining minimal acceptable conditions, and exploring and
enhancing demand through trade.
Analytical Tools
To achieve these goals, economists rely on economic tools such as cost-benefit,
input-output, financial, and trade analyses, as well as descriptive statistics
on various economic facets of the resource and those who use it. Cost-benefit
analysis (CBA) is the comparison of gains and losses in net
economic value from a regulatory action, where net economic value is
the sum of consumer surplus and producer
surplus. These surpluses are measured by estimating demand
and supply functions for various users of the resource.
Demand functions are
estimated using information such as prices and quantities4 of
the good under examination, as well as factors that influence demand
for a good such as the price of substitutes and available incomes. Supply
functions require information on quantities supplied (again
using the appropriate units, e.g., pounds of fish or number of
recreational trips), output prices, and factor prices and quantities,
or on production costs. Once market models are estimated, net economic
values can be measured by summing the surpluses. Regulatory alternatives
are evaluated by comparing the expected net economic value under existing
conditions with that expected under a new regulatory framework.
The majority of data elements listed in this document are used in CBA. However,
we also include information useful for descriptive purposes and for input-output,
financial, and trade analyses.
Input-output analysis (IOA)
is used to assess changes in income, revenues, expenditures, and employment,
usually on a regional basis rather than at the national perspective of
CBA. IOA is most often used by manufacturers and industries, and
by local and state governments, to determine changes in their market
share or tax base, respectively (Edwards 1990). IOA is not used
to address issues of net economic value. For instance, changes
in employment predicted from an IOA are sometimes mistakenly used to
argue for changes in net economic value, when, in fact, there may be
no relationship. The kinds of data required for IOA are incomes
and expenditures of various economic sectors. Although some of
the data illustrated in this document, such as information concerning
dependent industries, could be used to estimate economic impact, IOA
and related analyses require substantially more information than is listed
herein to describe the technical interactions among the industry, households,
and export markets.
Financial analysis takes
a closer look at individual players to determine how their behavior is
shaped by financial constraints. Cash flow analysis is one kind
of financial analysis that looks at the ability of firms to meet obligations
given the amount and timing of cash inflows. Financial ratios are
used to evaluate the financial performance of firms. In order to
facilitate these kinds of analyses, some financial data, such as amounts
of assets and liabilities, are needed.
Trade analysis is concerned
with how the structure of international markets affects the utilization
of domestic resources. Aspects of trade such as imports and exports
can be part of CBA and IOA. Therefore, trade activity is listed
as a data requirement in this document. To do a complete trade
analysis, however, detailed information on tariffs and trade sanctions
is required.
Data Collection Deficiencies
At present, many of the economic data needed to analyze economic effects
of fishery management regulations are not being collected by government
agencies with fisheries responsibilities. Most data collection
systems are almost completely lacking in economic considerations beyond
landings and prices. As a result, economic analyses in RIRs, environmental
impact statements, and environmental assessments are generally limited. Quite
often, economists are forced to analyze critical aspects of fishery management
decisions with insufficient data or to apply fairly specialized private-sector
data and analyses developed under disparate viewpoints and guidelines.
For instance, the sole source of cost data on otter trawl vessels used
in the analysis of Amendment 5 of the Northeast Multispecies FMP was
tax returns of 51 trawl vessels out of 2,049 vessels holding multispecies
permits (Groundfish Plan Development Team 1993). This small and
non-random sample provided the basis for examining fleetwide differences
in profits, variable costs,
and labor and fixed costs associated
with alternative regulatory actions. Similarly, limited industry
data were used to estimate product mixes, prices, and input costs for
evaluation of the inshore/offshore allocation decision in the Alaskan
Groundfish FMP. A CBA was required despite limited availability
of public-sector industry data. All offshore cost data were obtained
from the American Factory Trawlers Association, a trade group representing
the offshore sector (Milon 1993; Herrick et al. 1994).
Another result of insufficient data is that economists are often forced
to choose methods that use the available data rather than use a preferred
method, because the requisite data have not been collected. The
data needs identified in this document should permit most foreseeable
economic analyses. However, there are methods that require fewer
data. Some of these methods include duality theory5,
general equilibrium welfare analysis6,
almost ideal demand systems7,
and benefits transfer8. In
certain cases, these methods are apropos, and a subset of the listed
data could be collected to perform these analyses. But, in order
to establish a long-term, comprehensive system for economically evaluating
fisheries, the collection of all data listed herein is essential.
Data Collection Prospects
Imminent changes in the way the NMFS collects fisheries statistics have
prompted a reevaluation of economic data requirements. Events such
as the shift from voluntary to mandatory reporting systems, and national
initiatives such as the National Fisheries Statistics Strategic Planning
Process, offer an opportunity to assess what information is required
by economists to evaluate regulatory alternatives correctly.
Fisheries regulations are continually in a state of flux. Therefore,
it is important to establish baseline economic statistics to evaluate
fully the economic effects of management changes.
DATA IDENTIFICATION
METHODS
Renewable marine resources (i.e.,
wild finfish and shellfish resources, marine mammals, and other
aquatic life) are used in different ways and by various user groups. Figure
1 depicts the utilization of living marine resources
by various resource uses and the interactions among user groups. The
first level in the figure divides resource use into five use categories: 1)
seafood production from commercial harvesting, 2) seafood production
from aquaculture, 3) recreation, 4) non-consumptive uses of living
marine resources, and 5) subsistence and traditional uses of living
marine resources.
Below each resource use category in Figure
1 are various user groups. User groups classified
under seafood production from commercial harvesting are commercial
harvesters (including at-sea processors), processors and wholesalers,
retailers, and consumers. The seafood-production-from-aquaculture
user groups are identical to those delineated under seafood
production from commercial harvesting, except that commercial
harvesters are replaced by aquacultural producers9. Recreation
user groups are the provider (e.g., party or charter
boat operator) and angler. Under non-consumptive uses,
user groups are the provider (e.g., whale-watching boat
operator or diving-boat operator) and ecotourist. Lastly,
subsistence and traditional uses include groups of commercial-type
and recreational-type harvesters, including entities with treaty
rights.
This section of the document is organized by resource use, user
group, and entities of interest. Each resource use is introduced
with a brief discussion of the benefits derived
from the resource. User groups are similarly introduced. The
term “benefits” is defined here as the gross benefits that user
groups derive from the resource, not the net benefits that are
determined from a CBA in which opportunity
costs are considered.
Within each user group there are particular entities for which
information needs to be obtained. For example, in the anglers
user group of the recreation use category, there are two kinds
of entities: 1) party and charter boat anglers, and 2) “other” anglers
(i.e., private boat anglers and onshore anglers). In
addition, for each entity, certain data are needed that represent
annual or other periods, such as a trip or a month (i.e.,
the data period). Data can be collected every such
period, every other period, or within some other interval of periods
(i.e., the collection frequency). For each
entity, data can be censused or sampled (i.e., the data
coverage). For example, a sample (data coverage) of economic
and related data on individual anglers gathered from daily trip
(data period) surveys is needed every 3-5 yr (collection frequency). Table
1 shows how the data are organized and presented in the “Data
Categories, Elements, and Collection Schedules” section by
resource use, user groups, and entities of interest.
Data elements are specific pieces of information needed to answer
economic questions. Table
2 lists and defines data elements within the annual data and
other-period data subsections. In general, annual and other-period
data elements are presented similarly across user groups. In
some cases, this strict categorization does not make sense; some
deletions and/or additions have been made based on what is sensible
for an entity within a particular user group. Some data elements,
mostly identification data, are repeated in an entity’s annual
and other-period data because these sets of data need to be linked
together.
DATA CATEGORIES,
ELEMENTS, AND COLLECTION SCHEDULES
SEAFOOD
PRODUCTION FROM COMMERCIAL HARVESTING10
Economic benefits derived from seafood production from commercial harvesting
are: 1) harvest-sector employee incomes and vessel revenues; 2) value
added and employee incomes realized in processing, wholesaling,
transport, and retailing; 3) consumer surplus11 realized
by consumers; and 4) support and supply industry incomes and revenues
derived from seafood production from commercial harvesting. These
benefits are augmented at various points by exporting and importing activities. Additional
vessel profits and crew incomes are earned by providing harvesting services
in joint venture arrangements and by adding value through on-board processing.
Commercial Harvesters
Benefits derived from commercial fisheries consist of vessel revenues
and crew incomes derived from commercial harvesting of living marine
resources (including incomes and profits derived from joint venture arrangements),
and of support and supply industry revenues and incomes derived from
such harvesting.
Figure
2 illustrates the composition of data elements for commercial
harvesters.
Vessel and Related Onshore Facilities
Annual Data
Annual data elements enumerated in Table
3 provide a picture of the financial status of fishing firms and
are critical in evaluating how regulations affect investments and fixed
costs. Specifically, this information is needed to: 1)
identify producing units and inventory capital, 2) describe benefits,
3) establish financial condition of firms, and 4) identify and describe
the support industries related to the productive activity. The
completeness of the description of each firm, the degree to which all
firms and vessels involved in the industry are included, and the ability
to distinguish vessels in a given fishery are fundamental for evaluating
regulations effectively.
There is no substitute for a census of this information every year. A
series of tailored questionnaires could elicit the required degree of
detail without unnecessarily burdening any of the firms. Sufficient
information should be obtained to develop representative groups of vessels
whose performance can be used in assessing regulatory change. Cooperative
panels (i.e., a representative group of vessel owners willing
to provide information) could be developed on the basis of the census
data.
Trip Data
Table 4 lists the detailed
trip-level data which provide information needed for: 1) measuring
major costs of regulations, and 2) describing technical interactions
and production relationships. In addition, the trip-level data
provide important daily and set (tow) information (e.g., catch/bycatch
by gear, area(s) fished, disposition of landings) required for quota
and effort monitoring and in bioeconomic
modeling to link catch/bycatch levels to supply-and-demand
relationships.
Initially, it is crucial to census fishing activity for every trip in
order to design reasonable strata (by time and vessel type) from which
subsequent detailed sampling can be conducted.
Processors and
Wholesalers
Ideally, one would like to trace the flow of product from the harvest
sector to the point of final sale. Fish are imported or sold from
vessels to processors and wholesalers (including truckers) who then process
or deliver the product in final form to restaurants, retail outlets,
other institutions, and international markets. Processors and wholesalers
are heterogeneous, ranging from large multinational corporations to small
cottage-industry firms (such as crab picking). Information currently
available on some of these user groups is sparse.
Processor and wholesaler benefits include plant (firm) revenues and
employee incomes derived from transforming the raw product into final
form, and revenues and incomes derived from delivery of product (in raw
form, processed form, and final product) to retail institutions (both
domestic and foreign). To the extent that support and supply industries
are variously related to the supply of specialized inputs to the processing
and wholesaling sector (including transportation of product), then revenues
and incomes of these industries are appropriately counted in the benefits
of resource use.
Figure
3 illustrates the composition of data elements for processors
and wholesalers.
Plants (Firms)
Annual Data
The annual data elements presented in Table
5 provide information to characterize the industry and to examine
how its structure and organization change through time. In particular,
these data are needed to: 1) identify firms in the industry,
their investments, and their capacities; 2) examine benefits; 3) assess
the financial impact of harvest-sector management measures; and 4)
assess the importance of international trade.
A complete census of firms, using processor and wholesaler permit applications,
is desirable every year in order to identify the population of firms. Then,
the annual data needs could be achieved by either: 1) adding appropriate
questions to the applications, or 2) conducting a follow-up survey of
the identified population.
Monthly Data
Table 6 presents monthly
production and variable cost data which provide the basis for evaluating
how costs, profits, employment, and production are affected by management
regulations. This information is used in value-added studies, CBA,
and for assessing the financial health of firms. Production and
variable cost information are also important for tracing the flow of
product between ports to assess port dependencies and transportation
industries.
A census should be conducted every month until a sampling scheme is
designed.
Retailers
Retail markets are a final point of sale for fishery products. Data
on seafood purchased from restaurants are difficult to characterize because
prices are often for a whole meal, not just a fish product. Additionally,
there is usually no choice of quantity, and a visit to a restaurant is
made for many reasons unrelated to the price or quantity of fish. Notwithstanding,
benefits consist of revenues and employee incomes derived from the purchase
of seafood (in raw, processed, or final form) by consumers, and of revenues
and incomes of the support and supply industries providing specialized
inputs used in the production of seafood to restaurants and retail
markets.
Figure
4 shows the composition of data elements for restaurants
and retail markets.
Annual Data
The annual data elements illustrated in Table
7 characterize the retail market in terms of number and type of
firms, fixed costs, and investments. These data are needed to
assess the financial impact of changes in: 1) supply-and-demand
relationships caused by management regulations, including trade policies;
and 2) final demand (consumer demand) resulting from changes in seafood
preferences.
Initially, a complete census of the retail market is important to identify
subgroups for sampling. Thereafter, sampling should be conducted
every 3-5 yr.
Monthly Data
Table 8 illustrates monthly
production and cost data which provide the basis for evaluating how changes
in supply-and-demand relationships affect the number of customers served,
employment, and prices and quantities of transactions by seafood species
(including imports). This information is used in CBA to examine
production relationships, and in value-added studies and IOA to trace
the quantity and value of fish sales by product form.
A monthly data census should be conducted for 1 yr, followed by sampling
every 3-5 yr.
Seafood Consumers
Benefits derived from consumption of U.S. seafood consist of consumer
surplus realized by consumers in both the United States and in key foreign
countries which import substantial quantities of U.S. harvests (e.g.,
Japan, although Japan’s consumer surplus would not be counted in a CBA
of U.S. fisheries). When total benefits of seafood production from
commercial harvesting are measured (i.e., the summed benefits
of harvesting, processing & wholesaling, retailing, and consumption)
it is important to include consumer benefits because these constitute
an essential component of the value that consumers receive from fishery
resources.
Figure
5 shows the composition of data elements for seafood consumers.
Households
Annual Data
Table 9 presents the annual
data items needed to identify consumers of seafood, their household characteristics,
and their consumer preferences. This information is useful to: 1)
estimate demand models for marketing studies, 2) examine economic effects
of seafood contamination on consumers, 3) estimate consumer surplus (consumer
benefits) derived from seafood consumption, 4) estimate economic effects
of regulations on consumer demand, and 5) estimate economic effects of
trade policies.
Stratified sampling, based on census data, at the national level would
provide the requisite data. Surveys should then be conducted every
3-5 yr to capture changes in preferences and international demand.
Daily Data
Table 10 presents daily
consumption data which enable researchers to understand the factors that
influence the household consumption mix. These data provide the
basis for analyzing how demand relationships are affected by regulations,
seafood contamination, trade policies, and tastes and preferences. Additionally,
daily data provide information on direct effects used in IOAs of local
or regional income and employment.
To understand daily choices made by seafood consumers, logbook-based
studies should be undertaken every 3-5 yr. Such studies ask participants
to record on a daily basis their eating and shopping habits.
SEAFOOD PRODUCTION FROM AQUACULTURE
Economic benefits derived from the aquacultural industry are: 1)
employee incomes and producer revenues derived from the sale of aquacultural
products; 2) value added and employee incomes realized in processing,
wholesaling, transporting, and retailing; and 3) consumer surplus realized
by consumers. These benefits are augmented by international trade,
through either exporting final products or importing inputs to production. Additionally,
aquacultural products provide benefits to the processing, wholesaling,
and retail sectors.
Since processors, wholesalers, retailers, and consumers all utilize
aquacultural products, data on the use of these products by each of these
user groups need to be collected. Data elements for the user groups
in the seafood-production-from-commercial- harvesting resource use category
also apply here, but are not repeated.
Aquacultural Producers
This group covers all types of marine aquacultural operations, irrespective
of the production method used or the items cultivated (i.e., fish
food, finfish, shellfish, aquatic plants). It also includes operations
such as egg production, smolt production, and fish feed production.
Benefits derived from aquacultural production are revenues and employee
incomes from growing, storing, and harvesting finfish or shellfish grown
in a controlled environment, and the revenues and incomes of support
and supply industries derived from aquacultural production.
Figure
6 illustrates the composition of data elements for aquacultural
producers.
Production Facilities
Annual Data
Table 11 illustrates the
annual descriptive, fixed-cost, and financial status information needed
to develop aquacultural industry profiles, to perform financial analyses
of firms, and to conduct CBA and IOA.
Since aquaculture is becoming increasingly important, a census each
year of all aquacultural facilities is required.
Monthly Data
Table 12 illustrates monthly
production activity and variable-cost data needs. This information
contributes to the description of the aquacultural industry, helps in
financial analysis of firms, is useful in CBA, and provides information
on direct effects for use in IOA.
Initially, a monthly census should be undertaken; thereafter, representative
firms might be sampled every 3-5 yr.
Processors and
Wholesalers
See data elements for “Seafood Production
from Commercial Harvesting - Processors and Wholesalers.”
Retailers
See data elements for “Seafood Production
from Commercial Harvesting - Retailers.”
Seafood Consumers
See data elements for “Seafood Production
from Commercial Harvesting - Seafood Consumers.”
RECREATION
Benefits derived from marine recreational fishing are: 1) crew
incomes and producer revenues earned from party boat and charter boat
activities; 2) consumer surplus realized by fishermen (anglers); and
3) income, employment, and production by support and supply industries
generated from party and charter boat companies (recreational fishing
providers), and from boat-owning, boat-renting, or onshore anglers.
Providers
Benefits derived from recreational providers (party boat and charter
boat companies) consist of vessel revenues and captain and crew incomes
earned from providing recreational fishing trips, including revenues
earned from sale of fish and consumer goods (food, drink, tackle, T-shirts,
etc.) while on board . These providers comprise part of the demand
for goods and services produced by support and supply industries, thereby
generating incomes and revenues in local and regional economies.
Figure
7 illustrates the composition of data elements for recreational
providers.
Vessel and Related Onshore Facilities
Annual Data
The annual data elements in Table
13 represent the types of information needed to characterize the
industry and to examine how regulations of fishing gear or fishing
practices affect the economic value of production. In particular,
data are needed to: 1) examine industry profiles to understand
the constituency and organization of economic activity, 2) identify
fleet size and inventory capital, 3) conduct financial analyses of
firms to predict effects of regulations on solvency, and 4) assess
the direct effects of regulations for use in IOAs of local or regional
income and employment.
A one-time annual census of charter and party boats is needed. Subsequently,
sampling should be conducted every 3-5 yr to capture entry/exit behavior.
Trip Data
Table 14 presents trip-level
data needed in describing and evaluating the effects of management regulations
on revenues, variable costs, and angler participation. Trip-level
harvest data are essential in quota and effort monitoring, and in bioeconomic
modeling to link harvest levels to supply-and-demand relationships (i.e.,
supply of trips by providers and demand for trips by anglers). This
information is used in CBA to examine changes in production relationships,
and in input-output models to estimate changes in income and employment.
Initially, a 1-yr census of each vessel’s trip activity should be conducted
to gain baseline knowledge on the fleet of vessels. Thereafter,
annual sampling of homogenous subgroups of vessels (e.g., by type
of operation, target species, and geographic area) would be adequate.
Anglers
Angler benefits consist of consumer surplus derived from the marine
recreational fishing experience. Anglers patronize support and
supply industries, thereby generating incomes and revenues in local and
regional economies.
Figure
8 shows the composition of data elements for marine recreational
anglers.
Party or Charter Boat Anglers
Annual Data
Table 15 presents the
annual data elements needed to examine profiles of marine anglers. This
information is necessary to: 1) identify the population of anglers,
2) identify subsistence fishermen for sociocultural studies, and 3) enumerate
and describe the support and supply industries directly related to party
or charter boat angler activities.
A census of charter boat and party boat anglers is impractical; instead,
a census every 3-5 yr of vessels and trips could be used to estimate
relevant economic relationships.
Trip Data
Table 16 presents angler
trip data needed to understand the effects of regulations (e.g.,
participation and access limits, creel limits, size limits) on
the net economic value of recreational fishing. Data on harvest,
preferences, and variable costs of fishing are used in demand analyses
and in CBA to assess how catch rates, fish size, etc., affect demand
for charter boat and party boat services.
Economic and related trip data on individual anglers should be acquired
every 3-5 yr to determine structural changes or changes in preferences
and demand. Daily intercepts of anglers’ trips on charter boats
and party boats would have to be accomplished to obtain trip-level data.
Onshore, Boat-Renting, or Boat-Owning
Anglers
Annual Data
Table 17 presents the
annual data elements necessary to examine profiles of marine anglers. This
information is needed to: 1) identify the population of anglers,
2) identify subsistence fishermen for sociocultural studies, and 3) enumerate
and describe the support and supply industries directly related to fishing
from shore or boats (private/rental).
Data should be sampled every 3-5 yr using intercept surveys to examine
changes in angler profiles and to estimate relevant economic relationships.
Trip Data
Table 18 presents angler
trip data needed to understand the effects of management regulations
(e.g., participation and access limits, creel limits, size limits) on
the net economic value of recreational fishing. Data on harvest,
preferences, and costs of fishing (including boat operating costs) are
used in demand analyses and in CBA to assess how catch rates, fish size,
etc., affect demand for marine recreational fishing.
Economic and related data on individual anglers could be sampled every
3-5 yr using intercept surveys. Intercepts of anglers’ trips would
also allow estimation of total catch and effort, and an evaluation of
structural changes or changes in preferences and demand.
NON-CONSUMPTIVE USES OF LIVING MARINE
RESOURCES12
Benefits derived from non-consumptive
use are: 1) crew incomes and provider revenues
earned from providing non-consumptive activities, 2) ecotourist
surplus (i.e., benefits received in excess of viewing costs),
3) support and supply industry incomes and revenues derived from
non-consumptive activities, and 4) existence values that may arise
independent of use.
Providers
Benefits derived from non-consumptive providers (e.g., whale-watching
boats, sightseeing boats, diving boats) consist of vessel revenues and
captain and crew incomes earned from providing non-consumptive trips,
including revenues earned from sale of consumer goods (e.g., food,
drink, binoculars, T-shirts) while on board. Non-consumptive providers
comprise part of the demand for goods and services produced by support
and supply industries, thereby generating income and employment in local
and regional economies.
Vessel and Related Onshore Facilities
The annual and trip data required for economic analysis of non-consumptive
providers and related activities -- both supply and demand -- would be
identical to those already listed for charter and party boat operations,
with the obvious omission of fishing gear and harvest information, and
a change in emphasis from fishing trips to wildlife observation trips.
An annual census of non-consumptive providers would initially be necessary
to enumerate the population of providers and to form a basis for subsequent
sampling every 3-5 yr.
Ecotourists
Individuals who receive benefits from their non-consumptive use of ocean
resources are defined to be ecotourists in this document. Ecotourists
either rent services of non-consumptive providers, or engage in non-consumptive
activities by themselves (i.e., view or enjoy some aspect(s) of
the ocean environment from private boats, personal rental boats, or from
shore).
Benefits consist of ecotourist surplus (i.e., non-consumptive
consumer surplus) derived from non-consumptive trips, and the incomes
and revenues of support and supply industries generated from ecotourist
activities.
Figure
9 illustrates the composition of data elements for ecotourists.
Annual Data
Table 19 presents the
annual data elements needed to examine profiles of ecotourists. Individual
and household information is needed to: 1) identify the ecotourist
population, 2) provide descriptive data for CBA to estimate effects of
regulations on net economic value of ecotourism, and 3) enumerate the
support and supply industries for use in IOAs of local or regional income
and employment.
Total aggregate participation should be estimated each year from a survey
of non-consumptive vessels. A census of non-consumptive vessel
ecotourists is impractical; instead, the census of vessels and trips
could be used to conduct a stratified sampling program of ecotourists
every 3-5 yr.
Trip Data
Table 20 presents trip
data needed to develop a basic understanding of ecotourism. Data
on ecotourists’ sightings, costs, and preferences can be used
in demand analyses to determine how marine animal abundance may affect
demand for non-consumptive vessel services, and in CBA to estimate effects
of regulations on the economic value of ecotourism.
Economic and related data on individual ecotourists might be acquired
every 3-5 yr to evaluate possible structural changes or changes in preferences
and demand. Economic data could be collected from add-on questionnaires
or from follow-up telephone contacts of surveyed ecotourists.
Existence Values
for U.S. Citizens
Ecotourists, anglers, and even non-users might
value the mere existence of living ocean resources and be willing to
pay to protect, preserve, or restore them. In economic circles,
natural resource values of this kind are known as existence values, and
are wholly independent of use of the resource, whether current or future,
potential or actual. Users of the ocean environment may hold both
use and existence values,
but non-users by definition can only hold existence values, if any (M.A.
Freeman 1993).
Existence value benefits consist of the maximum willingness to pay to
protect, preserve, restore, or prevent losses of living ocean resources
(e.g., takings of harbor porpoises in gillnet fisheries). There
are no markets for existence values, so valuation techniques such as contingent
valuation are typically employed to simulate market bids
for preservation, protection, and restoration.
Figure
10 illustrates the composition of data elements for estimating
existence values of U.S. citizens.
U.S. Citizens
Table 21 identifies the
annual data elements needed to estimate U.S. existence values associated
with preservation, protection, and restoration. Estimating existence
values is typically based on attitudinal and preference surveys.
On a need-to-know basis, households would have to be surveyed randomly
by mail or telephone to collect information on existence values.
SUBSISTENCE AND TRADITIONAL USES OF
LIVING MARINE RESOURCES13
Economic benefits derived from this user group are: 1) employee
incomes and vessel revenues from occasional sales of marine finfish and
shellfish, 2) value of the resources consumed by the harvester, and 3)
consumer surplus realized by consumers who buy from subsistence and traditional
users.
Subsistence, as used by social scientists, can have two meanings: 1)
activities by which people acquire the food (and other culturally defined
necessities) needed to sustain themselves whether through growing, gathering,
catching, bartering, or purchasing (Howard 1989); and 2) a system in
which people grow, gather, or catch all food (and obtain all other necessities)
solely for their own use and never for sale (Beals et al. 1977;
Schultz and Lavenda 1990; Stearman and Redford 1992). By
the first definition, we are all engaged in subsistence; by the second
definition, few are.
In general, individuals or households are engaged in subsistence if: 1)
they cannot afford to buy equivalent protein and other nutritional
needs in the market, or 2) the taking of certain organisms is vital
to their spiritual or cultural life. Primarily, subsistence
fishing consists of catching fish as part of a pattern of resource exploitation
that includes fishing, hunting, and the gathering of wild plants. All
of these activities are used to obtain household protein, and/or to acquire
species not commonly found at the retail level, but which may be important
to traditional meals or holidays of a particular culture.
In this document, subsistence harvesters are defined as those people
who either: 1) rely on fishing to supply directly at least part
of their dietary needs, and who may or may not also sell small amounts
of finfish or shellfish as a vital supplement to their income; or 2)
conduct traditional practices under treaty rights.
Those attempting initially to locate and identify subsistence harvesters
have a variety of possible sources of information, presumably from the
group itself. Those who fish from party or charter boats can be
identified through port surveys of party/charter boat captains, and through
questions added to surveys regarding size of catch, species, disposition
of catch, income levels, and frequency of outings. Local conservation
law officers can provide additional information, as can federal and state
personnel from fisheries agencies and social science researchers familiar
with different sections of the coastline.
Commercial-Type Harvesters
with Treaty Rights
Technically, those who fish commercially under treaty rights are defined
as engaging in a subsistence use, and therefore are discussed in this
section.
All of the data elements associated with the commercial harvesters user
group of the seafood-production-from-commercial- harvesting use category
apply to commercial-type harvesters with treaty rights. In addition,
the questions in Table
22 are germane in order to assess benefits derived from resources
not sold.
Recreational-Type
Harvesters with Treaty Rights
While some treaty rights involve commercial fisheries, others involve
low harvest levels and non-intensive harvesting techniques. These
harvesters may fall under the small-scale, food-oriented definition.
All of the data elements associated with the anglers user group of the
recreation use category apply to recreational-type harvesters with treaty
rights, as do the incremental questions listed in Table
22.
Non-Treaty-Right Harvesters
A third group of subsistence harvesters, which overlaps to some degree
the recreational fishery, is composed of those people who catch some
fish for recreation, but also some for food and/or income. Some
of this third group may fish from party boats. Many will fish only
from shore. Some may be children or the elderly. Others will be
low-income single adults or heads of low-income households. Some
subsistence harvesters will be members of established ethnic/cultural
enclaves, recent immigrants, or minorities. As noted above, these
latter two groups (low-income and ethnic/cultural groups) may include
crew members of commercial vessels and their families. Often, even when
they constitute important populations, these non-treaty-right subsistence
harvesters are not recognized by policy and regulatory bodies (Fortmann
1990; M. Freeman 1993).
All of the data elements associated with the anglers user group of the
recreation use category, as well as the incremental questions listed
in Table 22, apply to non-treaty-right subsistence
harvesters.
Members of ethnic/cultural groups who are commercial harvesters without
treaty rights are generally indistinguishable from other commercial harvesters,
and are therefore not discussed here. They are not subsistence
harvesters by our definitions. However, some may still consider
themselves to be following a traditional lifestyle. The questions
listed in Table 22 are thus applicable to
this group as well.
ENDNOTES
- The glossary serves
as a reference for all key economic concepts, principles, and analyses
identified in bold italics.
- See Edwards (1990) for a thorough discussion of economic
efficiency, cost-benefit analysis, and input-output analysis as they
relate to fisheries resources.
- Guides have been developed
to assist policymakers in designing and executing economic data collection
programs, but most
of these efforts describe needs based on only a portion of the entire
fishery system -- the harvest sector -- and are generally geared towards
small-scale fishery administrators. See Stevenson et al. (1982),
Sutinen and Pollnac (1980), Smith (1979), and Smith (1975).
- Prices and quantities should be measured in units
appropriate for the particular user group (i.e., fishing trips
for recreational fishers, pounds of fish for seafood production,
or sightseeing trips for non-consumptive users), or, if measuring
derived
demand, in units appropriate for the inputs being measured.
- For
a discussion of duality theory, see Beattie and Taylor (1985) or
Chambers (1988). For examples of duality theory
applied to fisheries, see Ward (1991) or Kirkley (1986).
- See Thurman and Easley (1992).
- See Cheng and Capps (1987).
- See USEPA (1993) and Krupnick (1993).
- To limit redundancy, the processors and wholesalers,
retailers, and consumers user groups are only depicted under the
seafood-production-from-commercial-harvesting use category; as shown
in Figure 1, these
user groups are associated with seafood production from aquaculture
as well.
- Includes at-sea processors, joint ventures, and
directed foreign fishing.
- In contrast to other gross benefits illustrated
in this document, consumer surplus (defined in the glossary) is a measure
of net economic value (i.e., a benefit in excess of costs). Due
to the confusion often associated with the total economic value of
consumer benefits (i.e., gross benefits measured by maximum
willingness to pay) and the importance of consumer surplus in CBA,
we have chosen to use consumer surplus when referring to consumer benefits
from consumption or use of a good or service.
- See the glossary for definition.
- For detailed case studies on managing subsistence
fisheries in an industrial context, see Feldman (1981), Hanna and
Smith (1993), and Pinkerton and Keitlah (1990).
ACKNOWLEDGMENTS
In
preparation for a March 1993 Fisheries Data Needs Workshop, the Economics
Investigation at the NMFS’s Northeast Fisheries Science Center identified
data needed to carry out various economic analyses of fisheries regulations. Results
of that group effort formed the substance of this document. The
members of the Economics Investigation at that time were: Patricia
Clay, Steven Edwards, Andrew Kitts, Philip Logan, Barbara Pollard-Rountree,
Scott Steinback, and John Walden.
We appreciate the helpful Center reviews of Steve Edwards, Jon Gibson,
Fred Serchuk, Terry Smith, and Eric Thunberg.
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Acronyms |
| CBA |
= |
cost-benefit analysis |
| FMP |
= |
fishery management plan |
| IOA |
= |
input-output analysis |
| NMFS |
= |
National Marine Fisheries Service |
| RIR |
= |
regulatory impact review |
