Increasing Returns and Cycles in Fishing

M. Liski, P.M. Kort, A.J. Novak

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Abstract

We consider optimal fishery management under the assumption of increasing returns that is supported by previous empirical evidence. We improve the tractability and realism of the previous approaches by introducing flow adjustment costs on changes in harves rate. Our framework is the first to provide a link between stable limit cycle policies and increasing returns in harvesting. The type of the harvest policy depends on flow adjustment costs: for relatively costly adjustments the usual steady state harvest policy is conceivable, whereas for relatively cheap adjustments the harvest policy is cyclical. We also show a connection between chattering control policies and limit cycles, which helps us to develop a clear economic meaning for cyclical harvesting.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages27
Volume2000-57
Publication statusPublished - 2000

Publication series

NameCentER Discussion Paper
Volume2000-57

Keywords

  • Nonconvexities
  • adjustment costs
  • Hopf bifurcation
  • renewable resources

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    Liski, M., Kort, P. M., & Novak, A. J. (2000). Increasing Returns and Cycles in Fishing. (CentER Discussion Paper; Vol. 2000-57). Microeconomics.