Defining economic welfare in fisheries

Research output: Contribution to journal › Journal article › Research › peer-review

Standard

Defining economic welfare in fisheries. / Jensen, Frank; Nielsen, Max; Ellefsen, Hans.

In: Fisheries Research, Vol. 218, 2019, p. 138-154.

Research output: Contribution to journal › Journal article › Research › peer-review

Harvard

Jensen, F, Nielsen, M & Ellefsen, H 2019, 'Defining economic welfare in fisheries', Fisheries Research, vol. 218, pp. 138-154. https://doi.org/10.1016/j.fishres.2019.05.011

APA

Jensen, F., Nielsen, M., & Ellefsen, H. (2019). Defining economic welfare in fisheries. Fisheries Research, 218, 138-154. https://doi.org/10.1016/j.fishres.2019.05.011

Vancouver

Jensen F, Nielsen M, Ellefsen H. Defining economic welfare in fisheries. Fisheries Research. 2019;218:138-154. https://doi.org/10.1016/j.fishres.2019.05.011

Author

Jensen, Frank ; Nielsen, Max ; Ellefsen, Hans. / Defining economic welfare in fisheries. In: Fisheries Research. 2019 ; Vol. 218. pp. 138-154.

Bibtex

@article{5657d94fe5ab4eec8a99fd5f17427384,
title = "Defining economic welfare in fisheries",
abstract = "Fishery economists often define economic welfare inconsistently because the resource rent or profit is maximized even when a producer and/or consumer surplus exists. In this paper, we propose a solution to this problem by departing from general economic concepts such as resource rent, producer surplus and consumer surplus. We argue that the rents and surpluses, which ought to be included in economic welfare, depends upon whether: a. fishing effort is heterogeneous or homogeneous; and b. the output price is constant or non-constant. To investigate which assumptions that are most reasonable, we have conducted reviews of the existing fishery economic literature. Based on these reviews, we conclude that the total resource rent, producer surplus and consumer surplus are significant, implying that the sum of these rents and surpluses is the most appropriate definition of total economic welfare. We also argue that the resource rent (opportunity cost)rather than the profit (actual cost)ought to be included in a welfare function for fisheries. Based on our own simple calculations, we show that the actual cost is greater than the opportunity cost, implying that the resource rent is greater than the profit.",
keywords = "Consumer surplus, Economic welfare, Producer surplus, Resource rent",
author = "Frank Jensen and Max Nielsen and Hans Ellefsen",
year = "2019",
doi = "10.1016/j.fishres.2019.05.011",
language = "English",
volume = "218",
pages = "138--154",
journal = "Fisheries Research",
issn = "0165-7836",
publisher = "Elsevier",

}

RIS

TY - JOUR

T1 - Defining economic welfare in fisheries

AU - Jensen, Frank

AU - Nielsen, Max

AU - Ellefsen, Hans

PY - 2019

Y1 - 2019

N2 - Fishery economists often define economic welfare inconsistently because the resource rent or profit is maximized even when a producer and/or consumer surplus exists. In this paper, we propose a solution to this problem by departing from general economic concepts such as resource rent, producer surplus and consumer surplus. We argue that the rents and surpluses, which ought to be included in economic welfare, depends upon whether: a. fishing effort is heterogeneous or homogeneous; and b. the output price is constant or non-constant. To investigate which assumptions that are most reasonable, we have conducted reviews of the existing fishery economic literature. Based on these reviews, we conclude that the total resource rent, producer surplus and consumer surplus are significant, implying that the sum of these rents and surpluses is the most appropriate definition of total economic welfare. We also argue that the resource rent (opportunity cost)rather than the profit (actual cost)ought to be included in a welfare function for fisheries. Based on our own simple calculations, we show that the actual cost is greater than the opportunity cost, implying that the resource rent is greater than the profit.

AB - Fishery economists often define economic welfare inconsistently because the resource rent or profit is maximized even when a producer and/or consumer surplus exists. In this paper, we propose a solution to this problem by departing from general economic concepts such as resource rent, producer surplus and consumer surplus. We argue that the rents and surpluses, which ought to be included in economic welfare, depends upon whether: a. fishing effort is heterogeneous or homogeneous; and b. the output price is constant or non-constant. To investigate which assumptions that are most reasonable, we have conducted reviews of the existing fishery economic literature. Based on these reviews, we conclude that the total resource rent, producer surplus and consumer surplus are significant, implying that the sum of these rents and surpluses is the most appropriate definition of total economic welfare. We also argue that the resource rent (opportunity cost)rather than the profit (actual cost)ought to be included in a welfare function for fisheries. Based on our own simple calculations, we show that the actual cost is greater than the opportunity cost, implying that the resource rent is greater than the profit.

KW - Consumer surplus

KW - Economic welfare

KW - Producer surplus

KW - Resource rent

U2 - 10.1016/j.fishres.2019.05.011

DO - 10.1016/j.fishres.2019.05.011

M3 - Journal article

AN - SCOPUS:85066278481

VL - 218

SP - 138

EP - 154

JO - Fisheries Research

JF - Fisheries Research

SN - 0165-7836

ER -

ID: 228692581