INCORPORATING STOCHASTIC HARVESTS INTO AN ANALYSIS OF PRODUCTION: THE U.S. ATLANTIC AND GULF OF MEXICO PELAGIC LONGLINE FLEET

Vessel operators maximize expected utility indirectly through cost-minimizing production decisions subject to stochastic harvests. Data on the Atlantic longline fleet, available from NMFS logbooks, is used for the empirical analysis. An ex ante multi-input cost function that incorporates expected rather than realized output levels is estimated and results are reported.