Optimal exploitation of a salmon fishery: a simulation approach

The purpose of this study is to investigate optimal exploitation of a Pacific salmon fishery under the assumption that exclusive property rights in a fishery have been vested in a single or sole owner. Based on a review of the existing fisheries economics literature which focuses largely (but not entirely) on long-term steady state analytics, it is argued that the associated modeling technique does not apply readily to Pacific salmon fisheries. This line of reasoning is supported by the development, along the lines of the existing literature, of both a within-season and a long-term model of a salmon fishery. The within-season model, which finds limited precedent in the literature, provides the opportunity to introduce two relationships important in anadromous salmon fisheries, i.e., a production function with a catch coefficient variable at the vessel level and a stock distribution function, or time-of-entry curve. An analytical general solution is obtained to the model incorporating these features. The intertemporal model incorporates a purely compensatory Ricker-type spawner-recruit curve to define the interseasonal relationship between spawning escapement and future recruits. This model is formulated as an optimal control problem and is solved by using the general form solution to problems of this type which has recently been developed in the literature. A numerical solution to optimal escapement from the Skeena River fishery is obtained for parameters and coefficients estimated from this fishery. Both models have signficiant shortcomings which motivate the development of a more complete model of the fishery. Though it retains the basic features of the within-season and intertemporal models, this larger model allows concurrent within-season and interseason analysis, contains two species in a joint harvesting technology, contains an age structure and a stochastic element, all of which are absent in the two earlier models. This model is simulated on a computer in two formulations -- one dealing with weekly fleet hiring by the sole owner and the other with annual fleet hiring. The alternative fleet hiring assumptions are introduced so as to assess the added efficiency which is provided by more flexible fleet hiring rules which would be an important feature of coast-wide attempts at rationalizing the British Columbia salmon fishery via establishment of property rights. The major findings of the study are several. The determination of an optimal escapement policy via simulation experimentation demonstrates that a computer model of this type can successfully be used in this fashion. The specified minimum annual escapement which maximizes the present value of net profits was 300,000 sockeye and 400,000 pink for annual fleet hiring while the weekly fleet hiring model required the additional application of a weekly minimum escapement of 30% of the available total sockeye and pink stock. Comparing the results of the two fleet hiring assumptions it was concluded that the weekly fleet hiring regime resulted in a larger present value of net profits considering the Skeena River fishery alone. In .a comparison of the optimal fishing effort indicated by the simultion model (as measured in vessel-days) with the effort expended in the actual fishery it was concluded that a minimum estimate of excess effort is approximately .15% for annual fleet hiring and 50% for weekly fleet hiring. Successful development and application of this computer-based model is a significant step towards development of the larger coast-wide model which can be used to estimate optimal capacity for the entire fleet.Arts, Faculty ofVancouver School of EconomicsGraduat