Climate change and continued fishing pressure threaten to
increase recruitment variability for many stocks globally. Shifts in
the inter-annual stability of an exploitable renewable resource may have
dramatic consequences for the industries and communities which depend
upon them. In this talk, the link between resource volatility and
industry structure is explored using two models. First, an agent-based
simulation model is presented to illustrate the effects of increasing
resource variation on the number of participants in an extractive
industry. Model output depicts a casual relationship between resource
stability and industry structure, showing few industry participants when
the resource is highly variable. Several other structural components of
the model are additionally explored and suggest policy prescriptions
that may mitigate environmentally driven industry effects. A second
model is also presented which empirically investigates the relationship
between resource volatility and industry consolidation. Here we apply
tools from portfolio theory to global fisheries production and
employment data, finding countries which exhibit higher portfolio
volatility in production across different species groups tend to employ
fewer people in their fishing industries. Both models suggest a strong
link between environmental stability and the structure of resource
dependent industries, indicating a need for proactive policies to
address anticipated effects of climate change.
Dr. Scheld is an assistant professor of marine science in the Department of Fisheries Science at the Virginia Institute of Marine Science. He holds a Ph.D. in Fisheries Science from the University of Washington, an M.S. in Environmental and Natural Resource Economics from the University of Rhode Island, and a B.S. in Resource Economics from the University of Massachusetts. His research interests lie at the intersection of human and marine systems, focusing on fisheries management and policy in explorations of decision-making, technology, and market structure.
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