Skipper skill and panel data in fishing industries

Abstract

Skipper skill or managerial ability plays a central role in the harvesting of fish and fishing power. Examining the influences of managerial ability on catch rates, however, may be complicated, since managerial ability is generally unobservable. Using panel data on production activities in the Pacific Coast trawl fishery, we examine the use of the fixed- and random-effects panel data models to depict managerial skill by intervessel differences, representing differences in technical efficiency. The random-effects production model is selected over the fixed-effects model. We conclude that skipper skill is more related to finding fish, dealing with unforseen events, and handling inclement weather than it is to managing the economic inputs.