Short-run Economic Benefits from Water Quality Improvements: an Application to the American Lobster (Homarus Americanus) Fishery of Long Island Sound

Abstract

This article proposes a quantitative investigation of the claim that improving water quality does not yield rents in commercial fisheries that are inefficiently managed. Specifically, a combined model of the resource dynamics and fishing effort is used to investigate the effects of policy scenarios on water quality improvements on the American lobster fishery in Long Island Sound. Results indicate that short-run positive rents can be extracted from the lobster fishery even when inefficiently managed, but they dissipate in the long-run as suggested by the economic literature.