FISHERY BULLETIN; VOL. 86, NO. 2 



SUMMARY AND CONCLUSIONS 



This study developed procedures for estimating 

 the capital stock and net investment using only 

 the information generally available. That is, data 

 on acquisition and list prices for some but not all 

 vessels and characteristics for most vessels in a 

 fleet were used to estimate capital stock and in- 

 vestment in a fishery. An hedonic approach which 

 specified the acquisition price as a function of ves- 

 sel characteristics was suggested as a possible 

 method for obtaining information necessary for 

 estimating capital stock and net investment. It 

 was argued that the approach was consistent with 

 procedures used by economists to estimate the 

 capital stock and investment in traditional indus- 

 tries. 



Estimates were based on 1,110 observations ob- 

 tained from NMFS and classified advertisements 

 for the period 1965-81. Vessel characteristics 

 pertaining to size and age were shown to be the 

 more significant characteristics for explaining 

 the value of a vessel. The corresponding informa- 

 tion was then used to estimate the capital 

 stock and investment in the New England fish- 

 eries. 



An interesting result was that although invest- 

 ment increased over time, there also was disin- 

 vestment in the fisheries. It was suggested that 

 this was possibly the result of vessel sinkings, 

 exit of vessels from the region, foreclosures, and 

 expectations of declining future net returns. 



It also was demonstrated that a vessel count 

 should not be used to indicate capital stock or 

 investment. The number of vessels generally in- 

 creased over time, but the level of capital stock 

 did not coincide with these changes. This suggests 

 that more attention should be given to developing 

 economic measures of capital stock and invest- 

 ment. 



A question still in need of attention, however, 

 cannot be answered from this study. That is, 

 given the level of investment, can an optimal uti- 

 lization and allocation of resources be deter- 

 mined. The answer is clearly no. This requires 

 management authorities to specify the objectives 

 of fisheries management and a detailed bioeco- 

 nomic model. 



There is a need for more research on invest- 

 ment, and in particular, the determination of the 

 optimum rate of investment. This includes re- 

 search on the social discount rate, reasons for in- 

 vestment, and the marginal productivity of capi- 

 tal. More important, additional research is 



required to better address the issues of fisheries 

 management, particularly whether or not public 

 expenditures should be allocated to managing 

 fisheries. 



ACKNOWLEDGMENTS 



Comments by William DuPaul, Wade Griffin, 

 Ray Hilborn, Maurice Lynch, Ivar Strand, and 

 two anonymous reviewers are gratefully ac- 

 knowledged. Any errors remain the responsibil- 

 ity of the authors. The article does not necessarily 

 reflect the opinion of either the National Marine 

 Fisheries Service or the Virginia Institute of 

 Marine Science. 



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