Fishing industry borrows from natural capital at high shadow interest rates

Quaas, Martin F., Froese, Rainer, Herwartz, Helmut, Requate, Till, Schmidt, Jörn O. and Voss, Rüdiger (2012) Fishing industry borrows from natural capital at high shadow interest rates Ecological Economics, 82 . pp. 45-52. DOI 10.1016/j.ecolecon.2012.08.002.

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Abstract

Fish stocks can be considered as natural capital stocks providing harvestable fish. Fishing at low stock sizes means borrowing from the natural asset. While fishing a particular quantity generates immediate profits and income, an interest rate has to be paid in terms of foregone future fishing income, as the fish stock's reproductive capacity remains low and fishing costs stay high. In this paper we propose to apply the concept of shadowinterest rate to quantify the degree of overfishing. It incorporates the relevant biological and economic information and compares across fish stocks.We calculate the shadow interest rates for 13major European fish stocks and find these rates to range from10% tomore than 200%. The concept of the shadow interest rate can be
used to make the economic consequences of overfishing transparent and to evaluate the profitability of shortterm catch reductions as investments in natural capital stocks.

Document Type: Article
Additional Information: WOS:000310187400005
Keywords: Overfishing; Optimal resource management; Harvest-control rules; UNIT-ROOT; MANAGEMENT; FISHERIES; MODELS
Research affiliation: OceanRep > The Future Ocean - Cluster of Excellence > FO-R03
OceanRep > The Future Ocean - Cluster of Excellence > FO-R02
OceanRep > GEOMAR > FB3 Marine Ecology > FB3-EV Evolutionary Ecology of Marine Fishes
Kiel University
OceanRep > The Future Ocean - Cluster of Excellence
Refereed: Yes
DOI etc.: 10.1016/j.ecolecon.2012.08.002
ISSN: 0921-8009
Projects: MYFISH, Future Ocean
Date Deposited: 05 Sep 2012 12:02
Last Modified: 29 Mar 2017 17:53
URI: http://eprints.uni-kiel.de/id/eprint/15139

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