Fishing participation choice during a climate shock: A case study of the 2015/16 California Dungeness crab fishery delay

Abstract

Consistent with other individuals dependent on natural resources, fishers face high income variability, as shifts in fishing returns are driven by ecological and climatic shocks, management decisions, and market demand. To buffer these risks, fishers may diversify their fishing portfolios, i.e., the set of fisheries to which they have access. While diversification of access is difficult to measure, current literature suggests that, on average, diversification of participation is associated with decreased revenue variability. However, fishing portfolio diversification differs from financial portfolio diversification if harvesters respond to shocks by reallocating effort across their portfolio, i.e., if diversification in participation is endogenous to shocks to the economic returns from fisheries participation. Here I examine the importance of endogenous fisheries participation choice using California Dungeness crab as a case study. Specifically, in the 2015/16 fishing season, a harmful algal bloom (HAB) delayed the fishery by over five months at some ports. In response to this shock, some vessels exited the crab fishery in pursuit of other fisheries. I explore both the role of past fishing participation diversity in the decision to exit the 2015/16 crab fishery using a logistic participation model, and the impact of the exit decision on seasonal fishing revenue using a counterfactual analysis. Results indicate that past participation diversity is a statistically significant predictor of exit in response to the HAB, and that although all active vessels, on average, earned less during the 2015/16 season than previous seasons, vessels that exited the Dungeness crab fishery to participate in other fisheries in their portfolios actually had larger revenue losses than vessels that fished California Dungeness crab. In the face of more frequent climate shocks, these results bring nuance to our understanding of the benefits from diversified fishing portfolios.