Resource Use with Physical Harvest Costs

Abstract

In Chaps. 8 and 9 we implicitly assumed that resource harvest does not, unlike commodity production, require inputs such as labor or capital. This is, however, an unrealistic simplification and this is why resource harvest costs are commonly found in sectoral models (for an overview, see Clark, 1990; Neher, 1990; Brown, 2000). In these models, harvest costs typically depend not only on the harvest volume as in Chaps. 6 and 7 but also on the resource stock. Applied to fisheries, harvest costs depend on the size of catch (Heaps and Neher, 1979) and on the available fish stock, following the generalwisdom ‘the more fish the easier to catch’ (Smith, 1968; Tahvonen and Kuuluvainen, 2000). The model of this chapter incorporates therefore harvest costs which depend inversely on the resource stock. Since ‘most fisheries in the world do not pay a wage rate but pay a share of the catch’ (Brown, 2000, 881), we assume moreover that harvest costs are accountable in resource units and thus affect the size of the stock. Both the assumptions of stock dependent harvest costs and of physical accountability are a clear difference to the harvest cost function employed in Chaps. 6 and 7.