and/or income, ex-vessel prices will increase, which in 

 turn produces an increase in returns to existing vessels 

 and fishermen. The rise in earnings induces more ves- 

 sels into the fishery, thereby expanding catch given 

 the biological limitation of the resource. The resource 

 limitation is built into the model by relating catch to 

 fishing effort or number of vessels fishing the re- 

 source. As fishing effort expands, the catch will even- 

 tually reach a maximum yield. Further fishing will re- 

 duce catches. Therefore, the concept of maximum 

 sustainable yield (MSY) is the largest number of 

 pounds offish that can be caught on a long-run annual 

 basis with a given level of fishing effort without impair- 

 ing the viability of the stock. 



The bioeconomic model does not permit overfishing 

 the resource where the level of fishing effort is greater 

 than that necessary to harvest MSY (which is the case 

 for Maine American lobsters). In this case, catch will 

 usually be less while fishermen and vessels will be 

 more than necessary to take MSY. This situation rep- 

 resents a waste of capital and labor as discussed in 

 Section III-E. The model will allow us to answer such 

 questions as the following: What is the economic im- 

 pact of a sudden increase in imports? What will hap- 

 pen to the fleet if the rate of growth of U.S. population 

 slows? What is the impact of increases in per capita 

 income of ex-vessel prices? 



B. The Use of the Model. 



To illustrate the usefulness of our bioeconomic 

 simulation model for the Maine lobster fishery, we 

 have presented in Table 23 the results of changing var- 

 ious critical variables or forces that influence the 

 fishery. The initial equilibrium for the system is for 

 1969. Given the 1969 variables, the model predicted a 

 catch of 22. 1 million pounds (actual- 19.8 million lbs. ) and 

 848,825 traps fished (actual-805.000 traps). Now 

 let us suppose that through economic development of 

 Maine (through an oil refinery, etc.) the opportunity 

 cost of labor (fishermen) increases. That is, lobstering 

 will have to pay 25 percent better to compete with 

 other job opportunities (such as an oil refinery) in 

 order to keep people working in the fishery. Holding 

 all other factors constant, this would increase the cost 

 of lobsters (through higher wages demanded) and re- 

 duce effort in the fishery. That is, the inshore lobster 

 fishery's product would be more expensive than com- 

 petitors' products. The results of reduced effort will 

 paradoxically be an increase in catch since the present 

 effort exceeds that necessary to take MSY. The catch 

 is predicted to increase to 22.3 million pounds. Simi- 

 larly, an increase in exogenous supply of all lobsters 

 through foreign imports or discovery of new domestic 

 resources would result in a large increase in the 

 market — 25 percent — depressing prices, holding all 

 other factors constant. The predicted result will be a 

 contradiction in the inshore American lobster fishery 

 due to the decline in prices. The number of traps 

 fished would be predicted to decline to 398,424 with a 



Table 23. — The impact of exogenous shocks to the Maine inshore 

 American lobster fishery on the effort, catch, and biomass. 



Source: See Appendix A. 



catch of 17.5 million pounds. Remember, these per- 

 centage increases used for purposes of illustration 

 would not normally take place in one year, but most 

 probably, over several years. 



As indicated in the discussion of demand for lob- 

 sters, increases in per capita income will increase the 

 per capita consumption of lobster on the overall level 

 of demand. As indicated in Table 23, a 5 percent in- 

 crease in per capita income will increase the number of 

 traps fished to 945,833 for a 130 haul-day year from 

 initial equilibrium. Unfortunately, the catch will fall to 

 20.8 million pounds as the fishery will become increas- 

 ingly overcapitalized. Finally, seawater temperature 

 has a positive influence on the catch within the ob- 

 servable range. A 1° decrease in seawater temperature 

 will decrease supply to 20.8 million pounds and reduce 

 the number of traps fished to 811,833. Of course, real- 

 ity is much more complex where all these forces work 

 together to provide a net influence. 



VI. POLICY CONSIDERATIONS 



A. Existing Regulations. 



The purpose of the Maine fishery regulations is to 

 conserve the fish, shellfish, lobsters, crabs, shrimp, 

 and marine worms in any coastal water or flats of the 



28 



