Table 25. — Projected inpact of various management schemes imposed on the Maine inshore American lobster flshery.' 



■Projection of 1974-impact of selected management strategies. Assumes that F° = 48°; Y = $677.9 billion, (1969 prices): POP = 212.4 million: 



0„ -I- I = 190.4 million pounds, and tt = $15,292. All prices and dollar values projected for 1974 are expressed in 1972 dollars. 



*The license fee per vessel was obtained by multiplying the license fee per trap by the average number of traps (562.8) fished per full-time 



vessel. 



necessary to harvest MSY by placing a license fee on 

 traps. With this scheme, the regulatory authority 

 would calculate a license fee on traps which would 

 reduce the level of existing effort to that necessary to 

 harvest MSY (estimated to be about 753,589) despite 

 an increase in demand for lobsters. Because we are 

 actually reducing fishing effort as opposed to freezing 

 it at the 1969 level, the estimated 1974 license fee per 

 trap must be higher, or $7.14; actual catch will not be 

 significantly higher. The regulatory authority would 

 receive approximately $5.38 million in license fee 

 revenue. However, this plan has all the disadvantages 

 of a general license fee plan discussed above. 



c. Reduce the existing level of fishing effort to that 

 necessary to make the marginal cost of landings equal 

 to ex-vessel price. ^ The idea here is to obtain the 

 greatest "net economic benefit" and was suggested by 

 such economists as Crutchfield and Pontecorvo 

 (1969). If a regulatory authority had tried this for the 

 year 1974, it would have had a drastic impact on the 

 fishery as the number of full-time equivalent vessels 



'For most industries, output will expand in response to demand 

 up to the point where the marginal cost of production (i.e., addi- 

 tional cost of producing one more unit of output) is equal to the price 

 received in the marketplace. This is considered an efficient level of 

 production. In the fishing industry, the condition does not hold be- 

 cause of the common property nature of the resource coupled with 

 resource limitations. Marginal cost pricing is never achieved in fish- 

 ing, and it is argued by some economists that regulations should be 

 so structured to achieve this objective. 



and traps would be reduced by almost 50 percent. To 

 accomplish this objective, an estimated 1974 license 

 fee of $23,63 per trap would be needed. This would 

 yield the regulatory authority approximately $10.8 

 million in revenue. 



From an economic point of view, it is argued that 

 this management strategy will result in the most effi- 

 cient operation of the fishery if fishermen and vessels 

 can easily move to other fisheries or industries. How- 

 ever, this strategy may be particularly unwise in rural 

 areas such as Maine where labor mobility is low. A 

 drastic cutback in the number of fishermen may in- 

 crease social problems where the social cost would 

 greatly exceed any social benefits derived from such a 

 management strategy. Therefore, this management 

 strategy is difficult, if not impossible, to justify on 

 economic grounds for many rural areas where the fish- 

 ing industry is located and also has the same disadvan- 

 tages as a general license fee plan on traps as discussed 

 above. 



d. Issue "stock certificates" to each vessel owner 

 based on average catch over the last 5 years while 

 freezing the existing level (1969) of fishing effort. 

 Under this scheme, the historic rights of each fishing 

 firm would be recognized. In a manner similar to a 

 private land grant procedure, the regulatory authority 

 would simply grant each fisherman a "private" share 

 of an existing resource of catch. The stock certificate 

 would be evidence of private ownership. Individual 

 fishermen would be free to catch up to their allotted 



31 



