Renewable resource management with environmental prediction: the importance of structural specification

Chris J. Kennedy and Edward Barbier

Canadian Journal of Economics, 2013, vol. 46, issue 3, 1110-1122

Abstract: Environmental variability can substantially influence renewable resource growth, and as the ability to forecast environmental conditions improves, opportunities for adaptive management emerge. Using a stochastic stockrecruitment model, Costello, et al. ( ) show the optimal management response to a prediction of favourable growth conditions is to reduce current harvests. We find this result may be reversed when environmental variability and stock are substitutes in growth, a possibility that has been ignored by resource economists. As an example, we analyze the South Carolina white shrimp fishery, finding the optimal response to a prediction of favourable overwinter conditions is to increase fall harvests.

JEL-codes: C61 Q20 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (3)

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