Fisheries development

From subsistence to commercial fisheries

The term "Fisheries development" has over the years been used on a number of different activities and approaches to development. In the context of developing countries, the term is associated with the development of fishing industries and economic growth, but maybe first of all with the support and enhancement of subsistence fisheries and poverty alleviation.

There are two necessary conditions of a subsistence fishery:
  • Available fish stock resources
  • Harvesting capacity by the production of fishing effort
Such fisheries have almost always exited. The aim is to produce food for the family and there may be almost no capital involved in the effort production. This therefore normally leads to low stock pressure, as the harvest is limited by the need of food and the lack of capital makes it impossible to produce huge fishing efforts.

The additional conditions needed to develop these subsistence fisheries into commercial fisheries are:
  • Available markets (fish markets and factor markets)
  • Wealth creation - access to capital
The second may be a consequence of the first.

As a result of the development from subsistence to commercial fisheries, we will have
  • Increasing price on labour
  • Decreasing price of capital (increased availability)
  • Labour is substituted by capital
Markets are made available as access to necessary infrastructure develops. Such infrastructure (roads, water, electricity) essentially are public goods. Since public goods will not be made available by market mechanisms, market access is hindered by lack of governance.

Economic growth and public goods


Public goods

Public good is a good that is non-rivaled and non-excludable. The consumption of a private good by one individual does not reduce availability of the good for consumption by others (non-rivaled); and no one can be effectively excluded from using the good (non-excludable).

Because of this the demand curve of public goods is constructed differently from private goods and even though the welfare gain of the single consumer always may be less than the cost, the sum of gained welfare by all consumers may exceed the cost of the public good, In that case the society is better off investing in the private good, even though it will not be produced by a market.

The existence of public goods is essential for all kind of economic development, in particular the development of economic activities as fishing.

Economic growth theory

From Solow (1956):
Let K be capital and L labour. The growth of capital (saving) is a fixed percentage (s) of total production (f):


Let the caital/labour ratio be r,


Labour is a function of time (population growth), with growth rate n:


Solow shows that


Since


or


which has a clear interpretaion: "The total product curve as varying amounts r of capital are employed with one unit of labour". The capital ration increases when the relative increase in capital is higher than the relative increase in labour.

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