The Management of Fishery in the Lagoon of Venice

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1 The Managemen of Fishery in he Lagoon of Venice Luca Rosseo Dep. TeAF, Universiy of Padova (Ialy) AGRIPOLI via Romea, 352 Legnaro (PD) ITALY Absrac. Recenly, Medierranean lagoon environmen, mainly in he Norh Adriaic area, has been hreaened by he overexploiaion of fishery. Fishing has been rapidly groing since clam (Tapes phippinarum) fishery has spread over several lagoons. Fishing groh has been accomplished by capial-inensive fishery equipmens increasing harvesing beyond he susainable biological groh. This paern is driven by myopic behavior and common propery fisheries ih free enry or open access. Insiuional arrangemens on fish resources may encourage a fishing farming maching he biological capaciy. In his sudy a bioeconomic dynamic model is used o describe he opimal resource allocaion in case of sole oner of fishery resource. This model has been applied o a specific fish, namely Grea green goby (Zoserisessor ophiocephalus), living in he lagoon of Venice. Resuls confirm biological overfishing and sock depleion has occurred. Mainly facors affecing bioeconomic equilibrium such as prices, ineres rae and fishing effor are fixed by marke. Ne insiuional arrangemens and policy ools such as confining clam fishery, limied-licensing enry and cach quoas may ensure sock rehabiliaion, highly producive fisheries as ell as environmenal proecion only if hey are suppored by adequae marke policies. Keyords: clam, overfishing, fishery managemen, myopic behavior, dynamic programming, limied access, cooperaives. 1. INTRODUCTION The Lagoon of Venice covering more han 55, hecares is he ides lagoon area of he Medierranean basin. Lagoon fisheries play an imporan role on he socio-economical and environmenal equilibrium of all Lagoon area. The lagoon fishery business accouns o over 8 million $ including secondary effecs coming from relaed economic secors (Boao and Defrancesco, 1994). Abou 2,5 people are employed (full or parime) in he lagoon fishery secor bu his number increases o 3,5 if relaed economic aciviies are aken ino accoun. Almos 1/3 of Medierranean fishery producion comes from Norh Adriaic sea here he Lagoon of Venice plays a criical biological role. No only are lagoons and fishing valleys an imporan source of fish bu hey are also nursery areas of many commercial fishes or feeding grounds for ohers. Therefore, lagoon environmen allos many species o complee heir biological cycle. The lagoon fish producion comes, hoever, from fe species because mos of hem are migraory and caugh on he sea. The lagoon fishery economy may donsize is imporance in he nex fuure. everal issues have arisen recenly: - progressive subracion of lagoon covered aer areas because of sedimen deposiion; - compeiive and conflicing uses of lagoon area: navigaion, public faciliies, ourism, indusrial and residenial selemens; - heavy polluion and environmenal degradaion coming from indusrial and agriculural aciviies; - he increasing fishing effor beyond he susainabiliy level; - he adopion of sophisicaed fishing capial-inensive echnologies ih a consequen decrease in manpoer level and increase in efficiency. The lagoon fishery producion comes o several aciviies: radiional fishing on lagoon canals and aer areas; valley fishing; farm fishing (aquaculure); mussel farming and clam fishing. Valley fishing is quie similar o he radiional one bu i occurs on fenced lagoon valleys and i is managed folloing rules issued in XI cenury. In paricular, he breeding is accomplished by shifing fish from an area o anoher and regulaing aer saliniy bu ihou feeding i. The fish qualiy coming from his breeding is higher han aquaculure one and he corresponding marke price is 4-5 imes higher han fish farming one. The valley fishing ensures high revenue hile employing lo environmenal breeding echniques. Laely, he lagoon environmen has been hreaened by he spreading clam fisheries. In he las decade, clam fishery has dramaically increased fisherman s revenue, many radiional operaors have specialized in his aciviy, and ne operaors ener o his producion hile he number of vessel has risen up. Even if clam fishery does no compee ih he radiional one, i has riggered a rapid and cruel fishery. In paricular, open access and high revenues have encouraged a more efficien and, ofen, illegal fishery ihou considering any environmenal damages. In , unauhorized or illegal clam fishery rough exreme fishing equipmens such as sucion dredger, vibraing, scrapers, and legal clam fishery

2 amouned o he record producion of 55. on, corresponding o 4 million $ and 2-3 people employed. ince clams live under aer boom, heir exracion implies sedimen movemens ih unavoidable environmenal impacs no only on morphology, sedimen and biology of he specific sie bu also on enire lagoon ecosysem. edimens, carried ou by idal or upsream curren, muddy aer and deposi elsehere ofen occluding canals of Venice. Environmenal damages coming only from boom modificaions and sedimen losses have been esimaed in roughly a dozen million dollars (Orel, 1997; Di ilvio, e al., 1997) even ough more deailed analyses sugges environmenal coss beyond 5 million $. Acually, he imporan clam fishery issue lies on he regulaion of harvesing by: - a conrol over clam fishery aciviy (harvesing rae, oal harvesing, iming, ec.); - he adopion of clam fishing echniques no environmenal aseful. The local adminisraion has proposed a managemen resource plan aiming o miigae environmenal fishery impacs on Veneian lagoon. This plan encompasses all lagoon fisheries focusing aenion no only on clams bu also on radiional fishing. This projec envisages a regulaion of clam fishing resricing i o 1/1 of he oal lagoon area (4, hecares). These ne arrangemens include also radiional fishery hich managemen is a complex ask involving muliple species and muliple uses. In paricular, he managemen of migraory species (mulles, basses, sea-breams, culefish, eels, ec.) living in he Lagoon for a limied ime, requires inernaional agreemen on fishery among Norh Adriaic counries (Ialy, lovenia, Croaia), hile he managemen of sedenary species is under naional, regional or local adminisraive conrol. This paper examines socio-economic and environmenal condiions underlying an opimal conrol managemen of sedenary lagoon species. The dynamic approach underlying he bioeconomic model suggess direcions for ineremporal radeoff beeen socio-economic and environmenal demand. The ouline of he paper is as follos: he second secion illusraes he curren lagoon fishery economy; in he hird secion fishery resource managemen of Lagoon of Venice is discussed. In he fourh paragraph he bioeconomic model is formally oulined and, in nex paragraph i is exended o myopic behavior and open access resource. The sixh secion, parameers required for model calibraion are se and, subsequenly, simulaion resuls are discussed. The final par discusses conclusions. 2. THE LAGOON FIHERY The producion of Lagoon of Venice includes several species: mollusk (mussels, clams, culefish), crusaceans (shrimps, grabs), marine and inland fishes (eels, mulles, gilheads, basses, ec.) as hey are repored in able 1. Mollusks Crusaceans Mussels Grabs: Clams - Carcinus medierraneus - Tapes decussaus hrimps: - Tapes philippinarum - Crangon crangon Culefish - Palaemon spp. Fish Grea green goby Mulles: - Zoserisessor ophiocepahlus - Mugil cephalus Boyer s sand smel - Chelon labrosus - Aherina spp. - Liza ramada Flounder - Liza auraa - Plaichhys flesus - Liza sapiens Bass Eels: - Dicenrarchus labrax - Anguilla anguilla ea-bream - parus auraa Table 1 Fish species of Lagoon of Venice Daa on lagoon producion (excluding clams and mussels) are repored on Figure 1. The mean yearly producion over , supplied by AAP (AAP, 1994), is compared ih he mean producion, esimaed by CVN 1 (CVN, 1998). This analysis suggess a decreasing producion of almos radiional lagoon species over ime. meric ons Grea green goby Boyer s sand smel Flounder Grabs of grabs hrimps (mean, AAP) 1997 (survey, CVN) mall shrimps Cuelfish Figure 1 Producion of main fish lagoon species ource: AAP, 1995; CNV, 1998 The value of his producion is repored on able 2. Assuming average prices recorded in 1997, he yearly value of lagoon radiional producion is roughly around 3 million $ (excluding recreaional and illegal fishing). 1 AAP, local associaion promoing aquaculure and fishery; CVN, Consorium Venezia Nuova. 2

3 Mean price Revenue $/Kg $ Fishes: Grea green goby , Boyer s sand smel 6.3 1,12,5 Flounder , Eels , Crusaceans: Grabs , of grabs ,5 hrimps 5. 16, mall shrimps 5. 28, Mollusks: Culefish , Table 2 Prices and revenue of main fish lagoon species ource: CNV, 1998 The oal revenue, coming from valley fishing and huning lagoon aciviies, is esimaed in 7.5 million $: 5 percen comes from selling fish, 18 percen from huning and he residual from oher aciviies (agriculure, minor fish producions, ec.). The average revenue is around 1,75 $/ha bu i changes dramaically from valley o valley depending on heir produciviy. Variable coss are abou 325 $/ha hile fixed coss are around 35 $/ha. Therefore, he average ne revenue is 225 $/ha. No, e urn aenion o clam fishery producion. In he Lagoon of Venice here are o clam species: he auochhonous one, Tapes decussaus, and he allochhonous one, Tapes phlippinarum. This laer as inroduced ino Veneian lagoon in he eighies. This species, coming from Indo-China, has developed rapidly because is biology (high groh rae, easy arificial reproducion and olerance o emperaure excursions, o saliniy or qualiy subsrae) is paricularly suied o Veneian lagoon environmen. This impored clam does no significanly modify ecosysem equilibrium (resource availabiliy, compeiion, ec.) because i found a free ecological niche. A hecare of clam may generae a revenue of abou 4,5-5 $ ha is 15-2 imes greaer han radiional fishery. This high revenue has lead o socio-economic and environmenal problems oulined in firs paragraph. The economic analysis of lagoon fisheries shos srong price insabiliy because of producion seasonaliy. The fish price may vary according o specific fish and harvesing ime. This insabiliy is sressed by illegal fishery, especially on clams, selling fish a loer prices because of loer producion coss. Fishing firms operaing in he Lagoon of Venice are mosly managed by a single operaor and heir producion comes especially from clams and mussels hile radiional fisheries (shrimps, grabs, mulles, ec.) accouns o only 3 percen of he oal. Mos of he firms are member of co-operaives especially because of bureaucraic and fiscal reasons bu neglecing marke sraegies. 3. THE MANAGEMENT OF FIH REOURCE ince XI cenury, he managemen of fish resources on Lagoon of Venice has had o mach impacs of producive aciviies (agriculure, fishery, navigaion, ec.) and he conservaion of lagoon ecosysem. During erenissima Republic, fishermen ere join in confraerniies. Each confraerniy had is on fishing area and as governed by rules and cusoms called Mariegole. In oher ords, fish resources ere allocaed among confraerniies and managed by a se of rules concerning he environmen (cerain fishing ools ere forbidden), he fish biology (fine-mesh ne ere forbidden), he managemen (each fisherman could fish only some species) and he marke (price differeniaion according o specie and size). Afer he fall of erenissima and he adven of Hadsburg Empire, fishery rules ere issued on Adriaic sea hile regulaions on he Lagoon of Venice ere negleced. Recen rules on fishing lagoon managemen aim o conservaion of environmen and fish socks hrough a sric classificaion of fishing ools and heir employmen (ho and hen) hile penalies are no significan. These regulaions suffer a fundamenal error: he managemen of fishery resources on Lagoon occurs in a open access regime hose consequences, explained by he Tragedy of Common (Hardin, 1968), are he overexploiaion and degradaion of fish resources. In he las decades, he managemen of fishery has received an ever-increasing ineres all over he orld. The exploiaion of fish resources has lead o diminishing socks and, in some cases, o sock depleion, i.e., he exincion of species. The problem of he overexploiaion is paricularly serious hen fishery is managed as common propery resource (Clark, 1985). In his case, a significan difference beeen he curren harvesing rae and he biological compaible one is found. A grea conribuion o opimal managemen fishery has been supplied from H.. Gordon (Gordon, 1954) esablishing, during fifies, fundamenal aspecs of common propery resource heory. According o his auhor, he overexploiaion is associaed ih incorrec definiion of he propery righs on fish resource. Being fishing effor (or exracion cos) loer han fish marke price, he curren harvesing level is higher ha he opimal biological one. Roughly speaking, each fisherman can fish herever and henever he likes ihou orrying abou ohers: everyone akes ino accoun only his cos ignoring he fac ha he increase in heir cach affecs he reurns o fishing effor for oher fishermen as ell as he healh 3

4 of fuure fish socks. In his ay, he fishing effor of any fisherman is equal o average revenue raher han marginal one hile open access provides for free enry unil all he economic ren is dissipaed. The Gordon saic model has been inegraed by M.B. haefer (chaefer, 1954) inroducing he concep of bioeconomic equilibrium. The bioeconomic model has been successively exended dynamic analysis (co, 1955). These models give ineremporal soluions including harvesing and sock evoluion compaible ih fish groh and simulae economic and biological changes. Bioeconomic dynamic fishery models have had several applicaions and developmens (Bur and Cummings, 1977; Clark, 1985; Kolberg, 1993; Larkin and ylvia, 1999). 4. MODEL The bioeconomic model employed in his sudy as firsly oulined by H.. Gordon, chaefer and co (co, 1988). The dynamic model applied refers o fishery socks managed by a sole oner 2. uch simplified assumpion emphasizes any single economic and biological effec focusing aenion on criical decisions abou fishery managemen. Nex, he analysis has been exended o he case of he fishery managemen as common-propery resource or open-access resource. In his model, fish is a reneable resource. In fac, hen fish resource is correcly managed, i offers produc for an unlimied ime. The sock may vary by increasing or decreasing harvesing over ime, i.e., by invesing or no invesing in fish resource. The invesmen on fish resources is based on he folloing equaion: ne groh rae = naural groh rae harvesing rae The ne groh rae is he producion funcion hile he naural groh rae is he biological componen. According o he chaefer model (1954, 1957) he naural groh rae paern is fied by a logisic funcion hose rae is given by: d g N 1 (1) d K ¹ here is he sock (biomass), g( ) is he groh rae hile k and K are he inrinsic groh rae and he environmenal carrying capaciy, respecively. The inrinsic groh rae is maximum groh rae of he populaion, i.e., Nog( ) hen ( )<<K. Analogously, K is he sock a seady sae equilibrium and he curren sock level ( )ok hen of. The logisic curve shos a decreasing rae assuming posiive values from he Minimum usainable Yield (MYmin) o ha Maximum usainable Yield (MY) and 2 This is no a monopolis because he sole oner has no marke price conrol. negaives values from MY o he environmenal carrying capaciy (K) (Figure 2). The sock may change from MYmin, close o zero, o he highes value of K, ie, he maximum sock suppored by he aquaic ecosysem. g () min Minimun susainable yield MY Maximum usainable Yield Figure 2 - Logisic groh curve ource: Clark, 1986 K Environmenal Carrying Capaciy ock, From a biological poin of vie, hen sock is less han is carrying capaciy, he fish populaion gros (ihou considering any harves) unil he groh rae becomes zero. If he harvesing rae is equal o rae groh rae, he populaion is sable. Therefore, all combinaions on he logisic curve are poenial equilibrium poins (or seady sae) of he populaion. The groh rae is maximum (and, herefore, he poenial harvesing) here sock is equal o he MY. The logisic curve has been modified by chaefer inroducing he harvesing rae, Q, d g Q 1 (2) N d K ¹ here he harvesing rae is expressed as a funcion of fishing effor: Q qe (3) here E is he fishing effor, i.e., he amoun of inpu such as fixed capial, equipmen, labor, fuels, ec. employed, hile q is cachabiliy coefficien. Dividing by, he rerien equaion shos he moraliy coefficien, F, hich is direcly proporional o he fishing effor and he cachabiliy coefficien: F qe (4) Riarranging equaion (2), and solving for Q on he seady sae MY, he fishing effor and harvesing rae ill be: K N E ; MY Q (5) MY 2N q 4 These values sho useful informaion abou harvesing and fishing effor paern depending on groh rae. Evenually, hese parameers es he exploiaion level of fishery. The economic componen of Gordon model is formalized by a profi funcion resuling from subracing fishing effor o sale revenues: max pq ce (6) 4

5 here p is he selling fish price hile c is he inpu cos per fishing effor uni. The equilibrium depends on he shape of groh curve, on he level of inpu employmen (fishing effor) and on he fishing coefficien. These parameers are included in a producion funcion expressing he harvesing as a funcion of fishing effor and sock (Clark, 1986): b b E, ) (7) ( here b is he harvesing level depending on fishing effor and sock. Dynamic modeling on naural resources is based on ineremporal opimizaion frameork. These models derive opimaliy condiions on biological and economic componens and sho he resource allocaion pah maximizing he elfare of presen and fuure generaions. The key elemens of a dynamic model are: 1) ineres rae used o discoun fuure profis; 2) he producion funcion; 3) prices and coss; 4) he equaion of moion. In fishing, his equaion includes he logisic groh curve: 1 g Q (8) ( ) here g( ), is he groh funcion; Q, he harvesing, and he sock level a ime. This expression is he dynamic componen aking ino accoun changes in sock and harvesing over ime. The reneable resource is susainable hen sock does no change over ime, resiss o shor-run shocks and generaes a sable long-run oupu. In a dynamic model he seady sae is a long-run equilibrium, hich is hardly reached in he shor-run because environmenal and economic variables change over ime coninuously. Acually, he exisence of a longrun seady sae ensures he susainabiliy of he resource. Formally, he ineremporal opimizaion model can be defined as follos. We assume a variable sock,, and a variable for harvesing, Q a ime, hile parameers are he uni cos, c, and he groh, g( ). The opimizaion process is carried ou hrough a maximizaion of ne benefis, i.e., oal benefis less coss discouned a ineres rae, r, and subjec o he sock regeneraing funcion. The main assumpion is decreasing marginal benefis over ime approaching zero hen he ime ends o infiniy: Max L Q,, O subjec o: ' f r ³ e B Q ) Q c( ) ( d (9) g( ) Q ; Q qe (1) here B(Q ) is he revenue funcion and c( ) he uni cos of fishing effor. This problem of ineremporal opimizaion as firsly proposed by Hamilon and solved using he Principle of he Maximum (Ponryagin, 1964): H ( ) B( Q Q c O g Q (11) ) ( ) > ( here O is he shado price or opporuniy cos, i.e., he cos of he foregone alernaive of no using he resource. The shado price esimaes he resource scarciy. The opimizaion problem is solved by differeniaing (11) ih respec o he hree variables, Q, and O (Hoi e al. 1993): H Q H H O H ' Q H B Q c( ) O (12) g( ) Q Q c ( ) O g ( ) ' O ro (13) (14) In he firs equaion marginal revenue is equal o marginal cos. The laer is he sum of he uni cos of fishing effor and he shado price. If fishery is managed by a single firm operaing in a compeiive marke, he marginal revenue is equal o marke price. The second equaion shos ha he shado price change is influenced boh posiively by he ineres rae and he cos of fishing effor and negaively by he groh rae. The equaion (13) can be rerien as: O c ( ) r Q g ( ) (15) O O ' The equaion (15) suggess he folloing: hen sock is relaively lo he shado price could diminish because he effec of he ineres rae added o he cos of fishing effor may be counerbalanced by a posiive increase of he sock. On he conrary, hen sock is high he groh rae effec is posiive and, herefore, he shado price can only increase. The relaion (14) expresses he producion funcion aking ino accoun he regeneraion of he sock. The Hoelling rule (Hoelling, 1931), suggess an opimal dynamic equilibrium hen he fish price gros as he ineres rae. Acually, fishermen have o alernaives: 1) fishing and selling he produc on he marke and, hus, invesing money (geing ineress); 2) do no fish and ai ill fish price increases. According o Hoelling rule, hen values coming from hese o opions are equal, harvesing is opimally allocaed beeen he presen and he fuure (Figure 3). The ineres rae influences boh consumpion and price paerns over ime. In paricular, a high ineres rae increases acual consumpion hile fuure one goes don 5

6 quickly. On he opposie, a lo ineres rae shifs consumpion o he fuure (Figure 3). Q Consumpion lo r high r ime, P Price high r lo r ime, Figure 3 Effec of ineres rae on consumpion and price paern over ime The equilibrium beeen he acual and fuure consumpion and he price is influenced no only by he ineres rae bu also from he level of he iniial sock and he demand rend. For example, a high iniial sock increases boh curren and fuure consumpion and reduces price level over ime. Analogously, an increasing demand pushes curren prices up and loers consumpion over ime. If he dynamic model esablishes equilibrium here prices change as he ineres rae, hen he price rend can be forecased bu he equilibrium can be reached only hen fishing is managed by a sole-oner. Under hese condiions and assuming ha cos of fishing effor increases as sock diminishes, he harvesing level loers, over ime, ceeris paribus. economic equilibrium poin is esablished here r-g = (poin in Figure 2), ie, he difference beeen price and marginal cos is sable and he groh rae is exacly equal o he ineres rae. If > o, fishing and should be increased diminishing he sock and increasing he groh rae. On he opposie, If < o, fishing should be reduced increasing he sock and favoring resource appreciaion over ime. Opimal dynamic condiions can be beer highlighed in Figure 4, shoing revenue and cos paerns as a funcion of sock. From an economic perspecive, he opimal soluion lies here sock is equal o Maximum Economic Yield, MEY. This soluion does no mee biological, echnological and economic consrains hich push harvesing up and loer he opimal sock *. Thus, he opimal sock is locaed in any posiion beeen MEY and here he profi is zero. The opimal sock is equal o MEY only hen r=. Usually, a posiive and increasing ineres rae implies a loer conservaion of fish resource and hus opimal sock shifs o he lef. A he same ime, profis go don ill zero ( ) because of diminishing revenues. The exreme case happens hen he ineres rae is alays greaer han rae of groh, ie, r>g(). The soluion may be a sock level no susainable or close o he exincion. The model has been simplified assuming a fishing cos equal o zero, c=, o beer undersand he fisherman s behavior hen he ne discouned revenue is maximized and opimal condiions are me. Hence, shado price changes depend only on he difference beeen he groh rae and he ineres rae: Revenue, cos Cos = max ' O ( r g ) (16) O (1 g ) The equilibrium is, herefore, reached hen he change in price shado price is zero hile he groh rae is equivalen is he ineres rae: g ( ) r (17) The equaion (16) srenghs he fac ha he foregone marginal revenue for no fishing depends on o componens: one is economic (ineres rae) and he oher is biologic (he groh rae). When sock is equal o MY, he groh rae is zero (g =). ince r>, he opimal soluion is reached hen sock is less han MY. Thus if he curren sock is higher han MY, fishing should be encouraged o reach he opimal sock level as soon as possible. If r=, he opimal sock is jus equal o MY, ie, his is he biological opimal soluions, The biological and * MEY Revenue Figure 4 - Dynamic equilibrium ource: Clark K ock, Hoever, he cos of fishing effor is alays posiive and makes he exincion a soluion no significan. More realisically, fishing coss increase as sock diminishes, i.e., 'C()/'=C <. Theoreically, increasing coss suppor conservaion of fish resources. Formally, coss modify he equilibrium soluion as follos: O ( r g ) C (18) (1 g ) O(1 g ) ' O This equaion suggess ha shado price changes depend no only on he difference beeen he ineres and groh 6

7 rae bu also on fishing cos changes. The equilibrium condiions, herefore, are reached hen: r g C (19) O ince -C is posiive, he opimal equilibrium (if r is consan) is esablished here g is greaer han a soluion ihou fishing coss. Consequenly, he opimal sock ill be higher han * (Figure 4). 5. MYOPIC DECIION RULE AND COMMON- PROPERTY REOURCE o far, resource managemen has been analyzed assuming a sole-oner of fishery resource sock. In his paragraph effecs of common-propery resource or open access have been oulined. Firs of all, e assume ha fishing is accomplished by a large number of fishermen and each of hem has he righ o fish. This assumpion reflecs ha is no happening in he Lagoon of Venice. In his siuaion, each fisherman maximizes his discouned revenue ihou aking ino accoun he behavior of he ohers or effecs on fuure generaions. When all fishermen behave myopically, ie, ignoring ha his cach affecs reurn o fishing of oher fishermen, he harvesing level increases and sock decreases unil all ren ill be dissipaed. From an environmenal poin of vie, he myopic behavior and open access lead o he overexploiaion of resources held in common as ragedy of commons predics. Acually, he ragedy of commons approach, does no ake ino accoun socio-economic facors, eiher conflicing or cooperaing, characerizing fishermen operaing in he Lagoon of Venice. The ay and scale of overexploiaion depend on biology of single-species capured, on marke prices, on fishing effor and, hus, on echnology employed (Feeny e al., 1996). Noihsanding, he number of fishermen sill plays a relevan role, ie, he fishing effor increases ih he flee size, ceeris paribus. Graphically, a greaer flee size shifs he bioeconomic opimal equilibrium o he lef ill o he poin here he profi is zero (Figure 4). Hoever, he exploiaion of fishery should be evaluaed in a long ime horizon because he evoluion of fish prices may increase fisherman s revenue and fishing efficiency hile orsening he conservaion of fish resource. For example, laes echnological innovaions have exacerbaed he fishing capaciy, reducing coss and encouraging overexploiaion of fishery beyond he criical level of exincion (e.g. capuring non-marke size fish). In order o avoid overfishing, many counries have adoped policies limiing fishing effor (flee size and fishing poer) such as Toal Alloable Quoas (TAC) and Individual Transferable Quoas (ITQ) 3. The TAC ses a lo fishing level o permi sock rehabiliaion and once TAC has been aken, he fishery is closed unil he folloing year. The TAC operaes in specific ime (or monhs) during year. The ITQ provides a mechanism o eliminae redundan capial and labor accumulaed under pre-itq regime and encourages a cos-efficien producion. These policies have increase fisherman s revenue hile a reducion of fishing ime has raised fixed cos incidence 4. Roughly speaking, hese rules change he overfishing ino under capaciy uilizaion, decreasing, ceeris paribus, he fisherman s revenue. Therefore, hese policies limiing fishery are successful only if hey are accomplished ih an adequae marke or rade policy aiming o increase fish prices. 6. IMULATION REULT The model has been carried ou on a single fish species namely Grea green goby (Zoserisessor ophiocephalus), included on Gobiidae family, because is biological cycle is done inside he Lagoon. Resuls could also be exended o migraory species living on Lagoon for limied ime (using lagoon as nursery area or feeding grounds). Daa supplied by biologiss (Orel, 1995) and suppored by a fisherman survey (Province of Venice, 2) sugges ha: - he environmenal carrying capaciy is equal o 8 Kg/ha; - he inrinsic groh rae is,5 5 ; - he marke price is around 2 $/Kg; Coss are endogenous. They are performed by a nonlinear cos funcion hose parameers have been calibraed on daa coming from he sample survey analysis. In paricular, hen average harves is equal o 5 Kg/ha he oal cos is 2.9 $/Kg: 1.65 $ is variable and 1.25 $ is fixed. The funcional form of oal cos funcion is quadraic as he folloing: C Q Q 2 D E (2) here D=1 E=15. A.5 $ saring shado price and 5 percen ineres rae have been assumed. Daa have been processed in a muli-period non-linear mahemaical programming model. Non-lineariies derive 3 These policies have been adoped by European Union (CE reg. 376/92). 4 When fishing is suspended, boas sand by on harbor no having alernaive uses. 5 The fish populaion doubles each year. 7

8 from he quadraic cos funcion aiming o perform an increasing fishing effor. ae variables such as harvesing and resource dynamics are reaed endogenously hile marke fish price, biological and cos parameers and rasversaliy condiions are fixed. The model has been firsly calibraed over ime and sae variables such as sock, harvesing become sable afer 15-2 years. Hence, a 2-year ime horizon has been considered. The model has been run o es he curren fishery and o simulae effecs of policies aiming o increase fishery profiabiliy. Resuls sho ha he curren harvesing rae is neiher opimal nor sable and higher he opimal one. Assuming a ineres rae of 5 percen and a shado price of.75 $/Kg, in he firs decade he level of harvesing decreases from 129 o approximaely 17 Kg and reaches 9 Kg in he nex decade (Figure 5). The sock goes don rapidly unil he 6 h 7 h year, hen remains sable a around 51 Kg. Therefore, he curren harvesing (13-15 Kg) is 4 percen higher han he opimal one (Figure 5). ock (Kg/ha) Years ock (Kg/ha) Harvesing (Kg) Figure 5 - ock and harvesing paerns These resuls sugges a pruden fishery conrol aimed o reduce harvesing of abou 5 percen hrough he adopion of limiing harvesing policies such as TAC, limied-enry licensing, marke policies (e.g. prices). Then, he folloing effecs have been simulaed: - decrease of shado price; - reducion of fish marke price; - increase of shado price; - changes of ineres rae; - effecs on fisherman s revenue. hado price is a measure of resource scarciy: high shado price denoes posiive social expecaions for fish conservaion or environmenal proecion hile a lo shado price indicaes a greaer curren consumpion and marke-oriened policy. Assuming a reducion in fishery shado price from.75 $/Kg o.25 $/Kg, ie, assuming a decreasing sock value, he simulaion shos a declining equilibrium sock (approximaely 36 Kg) hile harvesing is abou 114 Kg, ceeris paribus. In fac, a loer sock value means increasing fishery exploiaion beyond he naural groh Harvesing (Kg) rae and, consequenly, a progressive decline of fish populaion. The opimal harvesing can be reached by decreasing marke fish price or increasing he shado price of fish resource. For example, if marke fish price decreases of 25 percen he harvesing loers of almos 3 percen; if shado price doubles he harvesing decreases of almos 3 percen. Resuls are srongly influenced by he ineres rae fixed by financial marke. Lo ineres rae expecaions may shif he consumpion o he fuure, reducing he curren harvess and, hus, favoring he conservaion of fish resource. For example, if he curren ineres rae decreases from 5 o 2 percen, he sock increases sensiively (2-3 percen) hile, in he firs decade, harvess go don (-2 percen). On he opposie, a perspecive of increasing ineres raes does no definiively suppor fish conservaion hile, paradoxically, miigaing he difference beeen he curren and opimal harvesing. Nex, income effecs on fishermen have been analyzed. The model simulaes revenue effecs of marke price and ineres rae changes. Assuming a reducion of marke fish price from 2 $/Kg o 1.5 $/Kg he corresponding fisherman s revenue change is negaive only in he shor run, hen approaches o zero. Afer he eigh year, he revenue becomes posiive because he value of increasing sock offses he direc economic loss suffered by fishermen. A decreasing ineres rae from 5 o 2 percen increases revenue significanly hile preserving fish resource. On he opposie, an increasing ineres, from o 5 o 8 percen, discourages fish resource conservaion hile fisherman s revenue goes don. Therefore, revenue effecs of a policy aiming o change marke fish price may be offse by an increase in he ineres rae or exacerbaed by decreasing ineres raes. Dollars Years Price=2 $/Kg (r=5% ) Price=1.5 $/kg r=2% r=8% Figure 6 Revenue paerns Finally, effecs of environmenal proecion and fuure fish resource preservaion on fisherman s revenue have been analyzed. A shado price reducion, from.75 $/Kg o.25 $/Kg, shifs fisherman s revenue o he lef (see 8

9 fig. 7) since he increase in harvesing does no offse a loer fishery resource value. produc. ince average Veneo income is high and consumers are illing o pay for a beer qualiy food, his markeing policy may be a successful sraegy in geing high revenue hile preserving fish socks. 8 Dollars Years Revenue (lo shado price) Revenue (curren shado price) Figure 7 Revenue pah and decreasing shado price 7. CONCLUION Resuls indicae ha he curren harvesing level is greaer han he opimal one. Moreover, his laer may furher diminish because of he ineres rae reducion orsening he fish sock size. The fish sock could also decrease because of increasing fish price and echnological changes. In fac, innovaions boh increasing fishing efficiency and reducing fishing effor may encourage harvess and diminish sock ill reaching he min here fish populaion is close o exincion. Indeed, a limiing harvesing seems o be he only effecive policy. Only can he opimal sock ensure permanen and sable revenue represening also he maximum amoun coming from a long run fishery managemen. This managemen is economic, biological and environmenal susainable. Hoever, any limiing harvesing regulaion should be accomplished by a marke policy avoiding revenue fisherman s losses. The fishery co-operaives could be a key ool in solving managemen fishery issues. In paricular, a fishing co-operaive may accomplished he folloing asks: x o guaranee a beer conrol over supply (qualiy and quaniy); x o implemen markeing policies; x o enjoy preferenial selling condiions; x x x o enjoy financing and fiscal faciliies; o ensure a conrol over fishermen by self-regulaion or regulaion imposed by he public agency managemen; o reduce ransacion coss of regulaion policy ih respec o public conrol. A raional and logical applicaion of hese ools increases fisherman marke poer ensuring beer and sable revenues. A he same ime, co-operaives regulae fisheries limiing harvesing and encouraging radiional harvesing ools no environmenally aseful. Evenually, a co-operaive may apply for cerificaing and labeling is 8. REFERENCE Adrokovich R.A., ollery K.R., Tax versus quoa regulaion: a sochasic model of he fishery, American Journal of Agriculural Economics, 39(4), , Arro, K. J., Lind R., Uncerainy and he evaluaion of public invesmen decisions, The American Economic Revie, 6(1), , Bell W.F., Compeiion from fish farming in influencing ren dissipaion: he crafish fishery, American Journal of Agriculural Economics, 68(1), 95-11, Boao V, Defranceso E., The fishery economy in Province of Venice: from producion o consumpion, (in Ialian) AAP, Bur R.B., Cummings G.R., Naural resource managemen, he seady sae, and approximaely opimal decision rules, Land Economics, 53(1), 1-22, Cacho O.J., Kinnucan H., Hach U., Opimal conrol of fish groh, American Journal of Agriculural Economics, 73(1), , Chiang A.C., Fundamenal mehods of mahemaical economics, Third ediion, McGra-Hill Inc., Clark C.W., Bioeconomic modeling and fisheries managemen, Dep. of Mah Universiy of Columbia, John Wiley and ons, Del Gao M., Noes on economic effecs of EU fisheries regulaion measures, (Ialian) Rivisa di Economia Agraria, 51(4), , FAO, Fisheries and aquaculure in Europe: siuaion and oulook in 1996, Fishery Dep, Rome, 1996, FAO, Revie of he sae of he orld fishery resources; inland fisheries, Fishery Dep, Rome Feeny D., Hanna., Mcevoy A.F., Quesioning he assumpions of he Tragedy of he Commons Model of Fisheries, Land Economics, 72(2), , Fisher A.C., Peerson F.M., The exploiaion of exracive resources: o survey, Economic Journal, 87(348), , Gordon H., The Economic Theory of Common-Propery Resource: The Fishery, The Journal of Poliical Economy, 62, , Hoelling H., The economics of exhausible resources, Journal of Poliical Economy, 39, , Hoi R.E., Taylor R.C., The economics of nonreneable resources, included in Agriculural and Environmenal Resource Economics edied by Carlson G.A., Zilberman D., Miranoski J.A., Ne York Oxford, Oxford Universiy Press, ,

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