Share Contract Choices and Economic Performance: Empirical Evidence from the Artisanal Fisheries Sector in Chile

TY - JOUR

T1 - Share Contract Choices and Economic Performance

T2 - Empirical Evidence from the Artisanal Fisheries Sector in Chile

AU - Salazar Espinoza, César Antonio

AU - DERG

N1 - JEL Classification: Q22, D86, D13

PY - 2015/1/1

Y1 - 2015/1/1

N2 - Typically, crew members in fisheries are remunerated through a share of the total revenues. However, there is little empirical evidence on the mechanisms by which revenues are distributed to labor and capital, and how these distributions affect economic performance. Under an agency problem framework, we estimate a dose-response function to study the formation of contracts and identify the marginal effects of changes in crew profit shares on fishing returns in Chilean artisanal fisheries. The results support share contract choices based on bargaining power, monitoring costs, technology, state of fishing resources, and outside options. We find significant effects of increasing crew profit shares on vessel owner returns in the interval (0.25, 0.65). The results vary across fisheries, however. While the effects are not significant in the fish group, they are larger and robust for molluscs and crustaceans. The latter finding is expected given differences in the observability of effort across fisheries.

AB - Typically, crew members in fisheries are remunerated through a share of the total revenues. However, there is little empirical evidence on the mechanisms by which revenues are distributed to labor and capital, and how these distributions affect economic performance. Under an agency problem framework, we estimate a dose-response function to study the formation of contracts and identify the marginal effects of changes in crew profit shares on fishing returns in Chilean artisanal fisheries. The results support share contract choices based on bargaining power, monitoring costs, technology, state of fishing resources, and outside options. We find significant effects of increasing crew profit shares on vessel owner returns in the interval (0.25, 0.65). The results vary across fisheries, however. While the effects are not significant in the fish group, they are larger and robust for molluscs and crustaceans. The latter finding is expected given differences in the observability of effort across fisheries.

KW - Faculty of Social Sciences

KW - ECONOMICS

KW - Fisheries economics

KW - Natural resource management

U2 - 10.1086/679463

DO - 10.1086/679463

M3 - Journal article

SN - 0738-1360

VL - 30

SP - 71

EP - 95

JO - Marine Resource Economics

JF - Marine Resource Economics

IS - 1

ER -