The Organization of the California Tuna Industry: An Economic Analysis of the Relations Between Market Performance and Conservation in the Fisheries

Abstract

California's most important fishery is based in the Eastern Tropical Pacific Ocean. The quantity of yellowfin„ skipjack and bluefin taken from this area represent virtually the entire domestic (United States) catch of light meat tuna. Scientific evidence has indicated that the maximum sustainable yield of yellowfin has been surpassed (overfished). The years 1960 and 1961 have been established as the starting point of this overfishing. During these two years, the quantity of fish taken (from the fishery) was large enough to affect the populations (yellowfin) resilience. This overfishing has led to the adoption of regulatory measures.This study is an evaluation of the California tuna fishing industry. Specifically, attention is focused on.Yellowfin the most valuable species to the California tuna fishermen. Examined and evaluated are the forces influencing the behavior of the individual fisherman. •The collective behavior of the fishermen is examined also in relation to the impact such collective behavior may have on the individual fisherman and consumer. Indicated by the evidence is a low degree of concentration on the sellers' side and a high degree of concentration on the buyers' side of the tuna market. Also illustrated was a uniqueness of tuna fishing costs. The typical tuna vessel owner is faced with high fixed costs and relatively, low variable costs. Average variable costs were, further, found to be fairly stable. Total average costs, given the preceding characteristics of fixed and variable costs, decline over a large range of outputs. This declining nature of average total costs encourages fishermen to fish intensively. It is in this manner that the fishermen are able to take full advantage of decreasing costs, Therefore, tuna fishermen fish intensively not only in hope of preventing others from acquiring ownership but also in hope of driving average costs down. In this case, costs accelerate the intensive behavior encouraged by the fugitive tuna resource. This maximum fishing activity engaged in collectively by the entire fleet was determined to be an influential factor leading the maximum sustainable yield to be surpassed. Total revenues and the change in consumers' surplus were calculated to determine the gains and/or losses accruing to the fishermen and consumer by fishing activity surpassing maximum sustainable yield. Comparison of the actual average landings for the 1960-66 period with the maintenance of the maximum sustainable yield (over the same period) revealed nominal impacts upon both fishermen and consumers. Shortrun consideration indicate that exceeding the maximum sustainable yield does not provide sufficient economic evidence requiring implementation of regulatory measures. Long run considerations are more difficult. While the cost evidence obtained revealed little change for the periods 1960-64 to 1966-67, it is impossible to conclude that fishing costs in alternative periods are independent. The possibility does exist that the impact brought about by exceeding the maximum sustainable yield are of a lagged nature. However, sufficient economic evidence is required (showing adverse effects accruing to both fishermen and consumers) before regulation Is economically justifiable (especially if irreversibilities are nonexistent).