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1 September 2012 Fishery Subsidies, Illegal Fuel Trading, and Conservation
CHIH-MING HUNG
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Abstract

This article incorporates illegal fuel trading behavior to examine the effects of changes in the fishery subsidy rate, detection effort, and fish price on the level of fishing, illegal fuel trading, and fish biomass. The corresponding effects on the fisherman's profits and the profits of the oil company that supplies the raw fuel to the fishery are also examined. The findings are, first, that the subsidy policy benefits the oil company, but its effects on the fisherman are ambiguous. Second, an increase in detection effort leads to less illegal activity in relation to fuel trading and more legal fishing resulting in less fish biomass. The detection policy hurts the oil company, the fisherman who engages in fuel trading, and resource conservation. Finally, an increase in fish price leads to a similar result as an increase in detection effort, but the effects on the fisherman's profits are reversed. The oil company also benefits from increasing fish price.

JEL Classification Codes: Q22, Q28

CHIH-MING HUNG "Fishery Subsidies, Illegal Fuel Trading, and Conservation," Marine Resource Economics 27(3), 253-265, (1 September 2012). https://doi.org/10.5950/0738-1360-27.3.253
Published: 1 September 2012
JOURNAL ARTICLE
13 PAGES

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KEYWORDS
conservation
Fuel subsidy
illegal fuel trading
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