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Assessing Changes in Capital and Investment as a Result of Fishing Capacity Limitation Programs

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Abstract

This paper provides a framework to evaluate the effectiveness of the European Multiannual Guidance Programmes on capacity limitation based on the evolution of the prices of used fishing vessels and on the measures of capital and investment derived from the estimation of a hedonic price function related to vessels characteristics. Attention is paid not only to the correct specification of the numerical variables but also, to testing for sample selection bias, to checking for structural change, to analysing the convenience of using alternative estimation methods and to discussing the potential bias as a result of asymmetric information in the used markets. The application of this framework to the Basque fleets evidences clear and coincident signs of successful adjustment after MAGP3, but also a substantial investment in the next periods as a result of the modernisation of the fleets.

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Authors and Affiliations

  1. Department of Applied Economics V, University of the Basque Country, Avda. Lehendakari agirre, 83, 48015, Bilbao, Bizkaia, Spain

    Ikerne del Valle Erkiaga & Kepa Astorkiza Ikazuriaga

Authors
  1. Ikerne del Valle Erkiaga
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  2. Kepa Astorkiza Ikazuriaga
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Correspondence to Ikerne del Valle Erkiaga.

Additional information

The authors are very grateful to the comments of the editor, three anonymous referees, and also to conference participants at: IV Conference Developments in Economic Theory and Policy (Bilbao, 10–11 July 2008), 35th Annual Conference of the Eastern Economic Association (New York 27 Feb-1March 2009), The XIX Conference of the European Association of Fisheries Economics (6–8 July 2009 Malta), Gretl Conference (Bilbao, 28–29 May 2009), and, XXXIV Simposio de la Asociación Española de Economía (SAEa) (Valencia, 10–12 December 2009). This study has received financial support from the EFIMAS (No SSP8-CT-2003 502516) (European Commission) and ETORTEK2003/IMPRES projects (Basque Government).

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del Valle Erkiaga, I., Ikazuriaga, K.A. Assessing Changes in Capital and Investment as a Result of Fishing Capacity Limitation Programs. Environ Resource Econ 54, 223–260 (2013). https://doi.org/10.1007/s10640-012-9591-1

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