Optimum Effort and Rent Distribution in the Gulf of Mexico Shrimp Fishery

Abstract

Traditional methods used to estimate fishing effort that maximizes rent to an open access resource have almost universally assumed all costs are directly proportional to effort. When crews receive a fixed share of gross returns, labor costs are proportional to catch; hence, rent accrues to crews as well as vessel owners under limited entry. A model that allowed costs to be proportional to effort and catch was applied to the Gulf of Mexico shrimp fishery. This study indicates that traditional analysis would result in management schemes that overtax vessels and ignore rent accruing to crews.

An Analysis of the US Shrimp Market: A Mixed Demand Approach

“…Griffin, Lacewell and Nichols (1976), estimated the optimum effort level for the Gulf shrimp fishery for 1973. This study Indicated that the equilibrium level of effort under open access fishery conditions at 1973 average prices with a normal return to labor, management and Investment was 201,800 units of effort or 2,277 vessels.…”

“…The captain and crew share from 42 to 33 percent of the "take" --the net value of shrimp less a portion of such operating expenses as fuel, Ice, processing charges, and gear repair. Although crewmen have traditionally resisted sharing the cost of fuel (Griffin, et al, 1976) the large fuel Increases of the 1970's has resulted In some shift to sharing fuel expenses (Roberts, personal communication). 1) Capture of finfish and shellfish, which are harvested and then discarded.…”

Remuneration systems used in the fishing sector and their consequences on crew wages and labor rent creation

“…Shared remuneration systems allow the crew to obtain higher wages by capturing part of the fisheries rent when the economic performance of the vessel improves (Griffin et al 1976), in part due to the crew work. Fisheries rent is a "surplus" from the exploitation of fisheries resources.…”

Drivers of Labor-Related Indicators across Diverse Mediterranean Fisheries

“…Payment for labor via a crew-share system rather than a fixed rate allows for the sharing of both risk and reward between the vessel owner and the crew and increases crew motivation [8,9]. It has been proposed that under the crew-share system remuneration can be regarded as an opportunity cost wage [3,10,11].…”