The Invisible Resource Rent in Limited Entry and Quota Managed Fisheries: The Case of Norwegian Purse Seine Fisheries

Abstract

This paper tests empirically to what extent the rent in a limited entry and quota managed fishery is capitalized in the value of a vessel license. This is done by comparing the profitability of Norwegian purse seine vessels which received their licenses for free, to the profitability of vessels whose licenses were purchased along with the vessel. In a sample of forty-three vessels, thirty-one had obtained their licenses for free when the licensing system was introduced in 1973, whereas twelve owners had bought licensed vessels later on. Costs and earnings data for 1983 and 1984 show that those vessels which received free licenses have a significantly higher profitabilty than the other vessel group. The main reason for this is that the owners who bought licensed vessels had the highest capital costs. Policy implications of these findings are indicated.

Economic performance of open-access offshore fisheries—The case of Vietnamese longliners in the South China Sea

“…Finally, this is 0.093 for total operating months and the number of tuna-longlining trips in 2004. with 4 and 23 degrees of freedom, are in favor of the existence of the second order terms in the models. This is in line with Flaaten et al, 1995, who adopted this approach to study factors affecting annual revenue and costs of Norwegian purse seiners. The advantage of this approach is that the meaning of estimated parameters can be interpreted easily.…”

“…Although the above tests did not demonstrate any clear evidence of heteroscedasticity in our sample, the potential problem may still warrant a formal treatment (see, e.g. Flaaten et al, 1995). White's procedure for correcting for heteroscedasticity is therefore also reported in Tables 3 and 4.…”

“…Thus, the definitions used in this paper correspond in principle to those used in several profitability analyses of fishing vessels in industrialized countries (Flaaten et al, 1995;Action, 2004). As noted above, however, adjustments to actual accounting and bookkeeping systems were necessary in this study.…”

Open-access fishing rent and efficiency—The case of gillnet vessels in Nha Trang, Vietnam

“…Most definitions of these indicators are the same as those used in European Commission (2004) and Long et al (2008). These definitions also correspond in principle to those used in several previous profitability analyses of fishing vessels in industrialised countries (Flaaten et al, 1995;Pascoe et al, 1996;Whitmarsh et al, 2000;Le Floc'h et al, 2008).…”

Nordic fisheries and aquaculture

“…Economic theory suggests that resource rent in open access fisheries has a tendency to dissipate and that fisheries operate at a level at which profits correspond to profits that could be earned in other activities (Copes, 1972). Producer surplus, also known as infra-marginal rent, is generated due, e.g., to the fixed cost and heterogeneity of capital and labor (Flaaten, Heen, and Salvanes, 1995). Producer surplus is the sum of the differences between the price received for a good and the price at which individual firms are willing to sell the good.…”