Starting 

 Point 



Aggregate Input Level 



implies : 



Entry 

 l-» 2 



3^ 2 

 3-*-2 



2^3 

 2-» 3 



(no chanf^e) 



Figure 3. — Expected factor adjustments, g^ven alternative 

 assumptions on key parameters. 



proxy variables. Additionally, the quality of 

 Bureau of Commerical Fisheries historical 

 data on resource levels in specific fisheries is 

 far from perfect. A major data limitation of 

 this study was that it was not possible to 

 separate full-time from part-time commercial 

 fishermen. 



The secondary data precluded any meaning- 

 ful estimation of marginal factor productivities. 

 Also, reliable data on factor acquisition prices 

 or salvage were not available. The first prob- 

 lem was bypassed by means of three assump- 

 tions; the second was resolved by the choice 

 of units of observations. Both require some 

 explanation. 



First, it was assumed that the demand for 

 salmon is i)rice-elastic at the ex-vessel level. 



Some support for this assumption comes from 

 two studies conducted at Oregon State Uni- 

 versity under the supervision of Dr. R. S. 

 Johnston (Charoenkul, 1970 and Wood, 1970). 

 Second, it was assumed that for the salmon 

 fishery as a whole, the supply of factors is es- 

 sentially fixed prior to the fishing season. The 

 direct implication of these two assumptions 

 is that increases (decreases) in landings bring 

 about increases (decreases) in average short- 

 run rents and/or profits over the industry. 

 The third assumption was that actual rents 

 in the year t equal expected rents in the year 

 t + 1, ceteris paribus. The expectation of cyclical 

 fish runs should be accounted for empirically, 

 since ceteris paribus is not a realistic assump- 

 tion in areas with pink and sockeye salmon. 



142 



