The Nonlinear Library EA - The responsiveness of aquatic animal supply by MichaelStJules
Apr 17, 2024
23:05
Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: The responsiveness of aquatic animal supply, published by MichaelStJules on April 17, 2024 on The Effective Altruism Forum.
Summary
Fishing is typically less responsive to price and demand shifts than aquaculture is, and in many wild fisheries, quite unresponsive overall on the margin. I discuss multiple reasons for this.
In some wild fisheries, lower prices and negative demand shifts for wild-caught species, e.g. from people going vegan or switching to plant-based substitutes, can actually cause their supply to increase. The price elasticity of wild capture supply in a fishery is negative when there's overfishing and no management practices that limit the price-responsiveness of capture around those price levels.
Given that fished stocks seem more often overfished than underfished, this could suggest that attempts to reduce demand - negative demand shifts - will tend to increase catch on the margin.
I describe background on elasticities and illustrate a simple method to approximate the effects of price and demand shifts on production.
I list supply elasticity estimates from the literature for wild capture and aquaculture. There seem to be few estimates for wild capture.
Fishery supply responsiveness
I take supply, market responses and elasticities to be in the 'long run', e.g.
"long-run supply elasticity", which is just long enough for no costs to be fixed, depends on the industry and I'd guess is typically less than a decade.[1] In the long run, firms (business, companies) can buy or sell capital (fishing vessels, barns, equipment), hire staff or let staff go, enter or exit the market, switch input factors, and otherwise change production levels.[2] If supply and demand were otherwise stable, then a permanent shift in either or prices leads supply and demand to
gradually moving until it approximately reaches a new equilibrium, and the long run is long enough for this new equilibrium to be approximately reached.
It's long enough for the market to approximately stop reacting to the shift. For fishing, reaching economic equilibrium would also require the fishery to reach population and catch equilibrium. In practice, equilibrium may never actually be reached, but the long run measures the time it would take to move from one economic equilibrium to another in response to a permanent supply, demand or price shift.
In the 'short run', over a shorter period of time, they are not able to do all of these, and at least one of their input factors, often capital, is fixed.
The long run effects are more representative of the ongoing effects of lasting shifts in supply or demand.
Wild capture (wild catch, fishing) is typically less responsive to price and demand shifts than aquaculture is, and in many wild fisheries, quite unresponsive overall on the margin. There are several related reasons to expect this.
H=harvest=C=catch, in weight per time period.
In open access (wild) fisheries - i.e. (wild) fisheries without policies restricting total catch and without responsive management, e.g.
seasonal closures - supply increases as fishing pressure (or harvest rates)[3] or prices increase when they are less than those that achieve the maximum sustainable yield, barely responds near the maximum sustainable yield, and decreases when fishing pressure and prices are less than those that achieve the maximum sustainable yield, as illustrated in the two graphs above (
Eide, 2012,
Eide, 2011,
Copes, 1970,
Pham & Flaaten, 2013 (
pdf),
Ritchie & Roser, 2021-2024,
Maximum sustainable yield - Wikipedia,
Melnychuk et al., 2020, pp.9-16,
Haddon, 2023, chapter 3). Inverse responsiveness, i.e. supply changing in the opposite direction as fishing pressure or prices, results from overfishing.
Wild aquatic animal stocks that are fished/exploited at all tend not to be underfished/underexploited, and are ...
Summary
Fishing is typically less responsive to price and demand shifts than aquaculture is, and in many wild fisheries, quite unresponsive overall on the margin. I discuss multiple reasons for this.
In some wild fisheries, lower prices and negative demand shifts for wild-caught species, e.g. from people going vegan or switching to plant-based substitutes, can actually cause their supply to increase. The price elasticity of wild capture supply in a fishery is negative when there's overfishing and no management practices that limit the price-responsiveness of capture around those price levels.
Given that fished stocks seem more often overfished than underfished, this could suggest that attempts to reduce demand - negative demand shifts - will tend to increase catch on the margin.
I describe background on elasticities and illustrate a simple method to approximate the effects of price and demand shifts on production.
I list supply elasticity estimates from the literature for wild capture and aquaculture. There seem to be few estimates for wild capture.
Fishery supply responsiveness
I take supply, market responses and elasticities to be in the 'long run', e.g.
"long-run supply elasticity", which is just long enough for no costs to be fixed, depends on the industry and I'd guess is typically less than a decade.[1] In the long run, firms (business, companies) can buy or sell capital (fishing vessels, barns, equipment), hire staff or let staff go, enter or exit the market, switch input factors, and otherwise change production levels.[2] If supply and demand were otherwise stable, then a permanent shift in either or prices leads supply and demand to
gradually moving until it approximately reaches a new equilibrium, and the long run is long enough for this new equilibrium to be approximately reached.
It's long enough for the market to approximately stop reacting to the shift. For fishing, reaching economic equilibrium would also require the fishery to reach population and catch equilibrium. In practice, equilibrium may never actually be reached, but the long run measures the time it would take to move from one economic equilibrium to another in response to a permanent supply, demand or price shift.
In the 'short run', over a shorter period of time, they are not able to do all of these, and at least one of their input factors, often capital, is fixed.
The long run effects are more representative of the ongoing effects of lasting shifts in supply or demand.
Wild capture (wild catch, fishing) is typically less responsive to price and demand shifts than aquaculture is, and in many wild fisheries, quite unresponsive overall on the margin. There are several related reasons to expect this.
H=harvest=C=catch, in weight per time period.
In open access (wild) fisheries - i.e. (wild) fisheries without policies restricting total catch and without responsive management, e.g.
seasonal closures - supply increases as fishing pressure (or harvest rates)[3] or prices increase when they are less than those that achieve the maximum sustainable yield, barely responds near the maximum sustainable yield, and decreases when fishing pressure and prices are less than those that achieve the maximum sustainable yield, as illustrated in the two graphs above (
Eide, 2012,
Eide, 2011,
Copes, 1970,
Pham & Flaaten, 2013 (
pdf),
Ritchie & Roser, 2021-2024,
Maximum sustainable yield - Wikipedia,
Melnychuk et al., 2020, pp.9-16,
Haddon, 2023, chapter 3). Inverse responsiveness, i.e. supply changing in the opposite direction as fishing pressure or prices, results from overfishing.
Wild aquatic animal stocks that are fished/exploited at all tend not to be underfished/underexploited, and are ...