Input substitution in a trap fishery

Abstract

This paper proposes a production function for a trap fishery and develops its implications for the economic management of associated inputs. The field observations and anecdotes from fishermen are drawn from the American lobster fishery, but the approach may also be used for other trap fisheries. The development includes a spatial aspect of fixed gear fisheries and an intuitive rationale for a congestion externality in such fisheries. This effect does not involve population dynamics per se. However, the production function developed below could eventually be imbedded within a population dynamics model, although this is not done here. This eventual imbedding is necessary not only because of the biological issues explained by population dynamics but also because of the dependence of price on the age-class structure of the population. A principal finding is that there are plausible reasons to expect market failure associated with a trap congestion externality and a soak time too short for cost effectiveness. The numerical analysis is consistent with the theory, and if this finding is supported by further research, then operating costs could be reduced with no change in catch by using more traps and longer soak times.