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2018-06-24 | Peer Reviewed

Share Contract Choices and Economic Performance: Empirical Evidence from the Artisanal Fisheries Sector in Chile

Salazar Espinoza, César. 2015. “Share Contract Choices and Economic Performance: Empirical Evidence from the Artisanal Fisheries Sector in Chile.” Marine Resource Economics 30:1: 71-95.
Download reference Doi:https://doi.org/10.1086/679463

Typically, crew members in fisheries are remunerated through a share of the total revenues. However, there
is little empirical evidence on the mechanisms by which revenues are distributed to labor and capital, and
how these distributions affect economic performance. Under an agency problem framework, we estimate a
dose-response function to study the formation of contracts and identify the marginal effects of changes in
crew profit shares on fishing returns in Chilean artisanal fisheries. The results support share contract choices
based on bargaining power, monitoring costs, technology, state of fishing resources, and outside options.
We find significant effects of increasing crew profit shares on vessel owner returns in the interval (0.25,
0.65). The results vary across fisheries, however. While the effects are not significant in the fish group, they
are larger and robust for molluscs and crustaceans. The latter finding is expected given differences in the
observability of effort across fisheries.