2.9.5 Evaluation procedure: Identify the 

 affected areas. 



(a) Identify the areas which the proposed alterna- 

 tive plans will have biological impacts. 



(b) Identify the areas in which the proposed alter- 

 native plans will have economic impacts. 



(c) Describe the process by which the biological 

 and economic study areas are linked. 



2.9.6 Evaluation procedure: Determine the 

 without-project condition. 



(a) Estimate the harvest of the relevant species 

 in physical terms if a plan is not undertaken. In- 

 clude a detailed description of the stock, including 

 catch per unit of effort and whether the estimated 

 harvest is at, or near, the range of absolute de- 

 creasing returns. (See 2.9.3(a)(1) and 2.9.9(a).) 



(b) Describe the most likely set of institutional 

 conditions that would exist without a project. (See 

 2.9.3(a)(2).) 



(c) Estimate the total cost of harvesting the rele- 

 vant species in each of the relevant years if a plan 

 is not undertaken. For each relevant species, deter- 

 mine the current weighted ex-vessel price corrected 

 for seasonal fluctuations. (See 2.9.3(a)(4).) 



2.9.7 Evaluation procedure: Determine 

 conditions that would exist with an 

 alternative plan. 



(a) Estimate the harvest of the exploited stocks 

 in each of the relevant years if an alternative plan 

 is undertaken. 



(b) Estimate the seasonally corrected current 

 price of the harvested species and the total cost of 

 harvesting in each of the relevant years if a plan is 

 undertaken. This will require an understanding of 

 the economics of entry and exit for the fish harvest- 

 ing industry, as well as the effects of a change in 

 harvest rates on the catch per unit of effort. 



2.9.8 Evaluation procedure: Estimate NED 

 benefits. 



(a) Calculate the ex-vessel value of the harvest 

 (output) for each alternative plan and for the with- 

 out-plan condition. 



(b) Determine the harvesting costs, including 

 nonproject operation, maintenance, and replace- 

 ment, for the level of catch (output) identified by 

 each alternative plan and the without-plan condi- 

 tion. 



(c) Compute the NED benefit from an alternative 

 plan as the value of the change in harvest less the 

 change in harvesting cost from the without-plan 

 condition to the with-plan condition. 



2.9.9 Problems in application. 



(a) As the harvest rate of living stocks goes up, it 

 is possible to reach a range in which the increases 

 in annual harvesting efforts will actually produce a 

 long-run decrease in the quantities harvested. In 

 the absence of effective limits on harvesting, it is 

 possible that commercial fishing will operate in this 

 range of absolute decreasing returns. This is possi- 

 ble because individual operators will compare only 

 their revenues and costs; they will not be con- 

 cerned with the absolute productivity of the stock. 

 This can be very important in determining NED 

 benefits because what may appear to be a positive 

 effect (something that encourages an increase in 

 harvesting effort) may ultimately result in negative 

 benefits (decreased total harvest and increased 

 total cost per unit of harvest). 



(b) The fact that fish are common, as opposed to 

 private, property creates special problems in meas- 

 uring NED benefits. Unless entry is restricted, ex- 

 cessive quantities of capital and labor may enter a 

 fishery; that is, entry may continue until the "eco- 

 nomic rent" from the living stock is dissipated. This 

 excess entry will result in economic inefficiency in 

 the utilization of fishery resources because the 

 value of the resulting extra output will be less than 

 the social opportunity cost of the entry. Some eco- 

 nomic benefits may be realized but the total bene- 

 fits will not be as large as they might be if entry 

 were restricted. Although evaluation of this poten- 

 tial has been limited by the specification of the 

 with- and without-plan condition in 2.9.3, three spe- 

 cific points are worthy of separate mention. 



(1) Transitory benefits. Because the benefits from 

 harvesting open-access fisheries tend to be dissi- 

 pated through entry of excess capital and labor, 

 some NED benefits from commercial fishing can be 

 transitory. It will therefore be necessary to deter- 

 mine how many years these benefits will last and in 

 what amounts for each year. 



(2) Industry capacity. The excess capacity that 

 will normally exist will make it difficult to obtain a 

 proper estimate of changes in cost associated with 

 changes in harvests. In some instances, idle boats 

 will be available and the only additional costs will 

 be operating costs. In other instances, vessels that 

 are already operating will be able to harvest the 

 extra catch without significant change in variable 

 costs. 



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