Risk averse policies foster bio-economic sustainability in mixed ﬁsheries
Sarah Jennings and
Cahiers du GREThA from Groupe de Recherche en Economie Théorique et Appliquée (GREThA)
This paper examines the role of risk aversion on the sustainable management of multispecies ﬁsheries with technical interactions. We consider a bio-economic dynamic model of multiple species harvested by a single ﬂeet with uncertain costs of eﬀort. We assume that the regulatory agency aims at reaching MMEY (Multispecies Maxi-mum Economic Yield) in an uncertain context by maximizing the expected utility of total proﬁts, where utility is a quadratic function capturing risk aversion. We ana-lyze the impact of risk aversion on optimal ﬁshing eﬀort, proﬁt, production, biodiver-sity and conservation. We show analytically that such a risk-averse MMEY promotes bio-economic sustainability as it mitigates the risk of biological and economic over-exploitation of the diﬀerent species. Risk aversion also enhances biodiversity in the sense of evenness within the portfolio of the ﬁshery. However, by reducing the eﬀort, risk aversion lessens the expected proﬁt and food production. Thus, a trade-oﬀ be-tween diﬀerent bio-economic goals is exhibited through risk aversion. We illustrate the analytical ﬁndings with the case study of the Australian South East Fishery, where small risk aversion levels allow for high global bio-economic performances and balanced management objectives, therefore fostering sustainability.
Keywords: Multispecies ﬁshery; ecosystem-based ﬁsheries management; maximum economic yield; uncertainty; risk aversion; overexploitation (search for similar items in EconPapers)
JEL-codes: Q22 Q57 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr, nep-env and nep-upt
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Persistent link: https://EconPapers.repec.org/RePEc:grt:wpegrt:2018-07
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