Input Controls, Input Substitution and Profit Maximisation in the English Channel Beam Trawl Fishery

Abstract

Studies of input substitution in fisheries have tended to focus on substitution between physical inputs and/or time fished. However, input controls may create incentives for substitution of other inputs into the production process. For example, fishers faced with constraints on access to particular areas of the fishery may substitute physical inputs for fishing location. This was the case with the UK beam trawl fishery in the English Channel. Constraints were imposed on access to particular areas of the fishery through restrictions on engine power. This created incentives for a number of fishers to reduce their engine power to meet the conditions of the input control. The relative contribution of the boat inputs and location in the production process and the potential for substitution were examined using a translog production function. The results suggested that the apparent input substitution was consistent with profit maximising behaviour.