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Growing the seafood sector: Technical change and innovation

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  • The scope for fishing firms operating in an output controlled fishery, with tradable rights, and facing world prices, to augment profit is limited inter alia to a search for alternative input configurations that lower harvesting costs. This paper provides evidence of technical change in the New Zealand rock lobster fishery. Industry response to a declining allowable harvest is seen in the percentage of harvesting rights exercised increasing over the 1992-2000 period. Over this period the total lobster fleet has steadily declined. Average output per firm, output per labour unit, and the capital-labour ratio have all increased. Econometric analysis finds the rate of technical change to have steadily increased over the period. The contribution of improving vulnerable biomass to lower harvesting costs is controlled for. Another innovation is seen in the seasonal shift of fishing effort, timed to coincide with better market prices. Clearly new technologies will continue to offer scope for lowering harvesting costs. Given the harvest constraints facing this industry economic growth in the future will also depend on innovations occurring through organizational design and contracting at various points along the chain of supply to market. Well-defined harvesting rights provide not only a degree of certainty over access to fish stocks they also provide a platform for contracting product supply that matches demand. Historically, seafood companies with an export focus have shown a preference for research and innovation aimed at increasing production and quality of production, rather than developing new product opportunities.
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  • Sharp, Basil, Andrew Jeffs. 2004. Growing the seafood sector: Technical change and innovation. Peer Review: No. In: Proceedings of the Twelfth Biennial Conference of the International Institute of Fisheries Economics & Trade, July 20-30, 2004, Tokyo, Japan: What are Responsible Fisheries? Compiled by Ann L. Shriver. International Institute of Fisheries Economics & Trade, Corvallis, Oregon, USA, 2004. CD ROM. ISBN 0-9763432-0-7
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