Prices and the Real Exchange Rate in Hong Kong: 1985-2006

This paper has been presented at the XIII Encuentros de Economía Aplicada, Sevilla, Spain, 2010.

Going Multinational under Exchange Rate Uncertainty

Published as an article in: Journal of International Money and Finance, 2010, vol. 29, issue 6, pages 1171-1191.

Submarine landslides : selected studies in the U.S. Exclusive Economic Zone

Submarine Landslides: An Introduction 1 By RIo Lee, W.C. Schwab, and J.S. Booth U.S. Atlantic Continental Slope Landslides: Their Distribution, General Anributes, and Implications 14 By J.S. Booth, D.W. O'Leary, Peter Popenoe, and W.W. Danforth Submarine Mass Movement, a Formative Process of Passive Continental Margins: The Munson-Nygren Landslide Complex and the Southeast New England Landslide Complex 23 By D.W. O'Leary The Cape Fear Landslide: Slope Failure Associated with Salt Diapirism and Gas Hydrate Decomposition 40 By Peter Popenoe, E.A. Schmuck, and W.P. Dillon Ancient Crustal Fractures Control the Location and Size of Collapsed Blocks at the Blake Escarpment, East of Florida 54 By W.P. Dillon, J.S. Risch, K.M. Scanlon, P.C. Valentine, and Q.J. Huggett Tectonic and Stratigraphic Control on a Giant Submarine Slope Failure: Puerto Rico Insular Slope 60 By W.C. Schwab, W.W. Danforth, and K.M. Scanlon Slope Failure of Carbonate Sediment on the West Florida Slope 69 By D.C. Twichell, P.C. Valentine, and L.M. Parson Slope Failures in an Area of High Sedimentation Rate: Offshore Mississippi River Delta 79 By J.M. Coleman, D.B. Prior, L.E. Garrison, and H.J. Lee Salt Tectonics and Slope Failure in an Area of Salt Domes in the Northwestern Gulf of Mexico 92 By B.A. McGregor, R.G. Rothwell, N.H. Kenyon, and D.C. Twichell Slope Stability in Regions 01 Sea-Floor Gas Hydrate: Beaufort Sea Continental Slope 97 By R.E. Kayen and H.J. Lee Mass Movement Related to Large Submarine Canyons Along the Beringian Margin, Alaska 104 By P.R. Carlson, H.A. Karl, B.D. Edwards, J.V. Gardner, and R. Hall Comparison of Tectonic and Stratigraphic Control of Submarine Landslides on the Kodiak Upper Continental Slope, Alaska 117 By M.A. Hampton Submarine Landslides That Had a Significant Impact on Man and His Activities: Seward and Valdez, Alaska 123 By M.A. Hampton, R.W. Lemke, and H.W. Coulter Processes Controlling the Style of Mass Movement in Glaciomarine Sediment: Northeastern Gulf of Alaska 135 By W.C. Schwab and H.J. Lee Contents V VI Contents Liquefaction of Continental Shelf Sediment: The Northern California Earthquake of 1980 143 By M.E. Field A Submarine Landslide Associated with Shallow Sea-Floor Gas and Gas Hydrates off Northern California 151 By M.E. Field and J.H. Barber, Jr. Sur Submarine Landslide, a Deep-Water Sediment Slope Failure 158 By C.E. Gutmacher and W.R. Normark Seismically Induced Mudflow in Santa Barbara Basin, California 167 By B.D. Edwards, H.J. Lee, and M.E. Field Submarine Landslides in a Basin and Ridge Setting, Southern California 176 By M.E. Field and B.D. Edwards Giant Volcano-Related Landslides and the Development of the Hawaiian Islands 184 By W.R. Normark, J.G. Moore, and M.E. Torresan Submarine Slope Failures Initiated by Hurricane Iwa, Kahe Point, Oahu, Hawaii 197 By W.R. Normark, Pat Wilde, J.F. Campbell, T.E. Chase, and Bruce Tsutsui (PDF contains 210 pages)

The Annual Economic Survey of Federal Gulf Shrimp Permit Holders: Report on the Design, Implementation, and Descriptive Results for 2006

This technical memorandum documents the design, implementation, data preparation, and descriptive results for the 2006 Annual Economic Survey of Federal Gulf Shrimp Permit Holders. The data collection was designed by the NOAA Fisheries Southeast Fisheries Science Center Social Science Research Group to track the financial and economic status and performance by vessels holding a federal moratorium permit for harvesting shrimp in the Gulf of Mexico. A two page, self-administered mail survey collected total annual costs broken out into seven categories and auxiliary economic data. In May 2007, 580 vessels were randomly selected, stratified by state, from a preliminary population of 1,709 vessels with federal permits to shrimp in offshore waters of the Gulf of Mexico. The survey was implemented during the rest of 2007. After many reminder and verification phone calls, 509 surveys were deemed complete, for an ineligibility-adjusted response rate of 90.7%. The linking of each individual vessel’s cost data to its revenue data from a different data collection was imperfect, and hence the final number of observations used in the analyses is 484. Based on various measures and tests of validity throughout the technical memorandum, the quality of the data is high. The results are presented in a standardized table format, linking vessel characteristics and operations to simple balance sheet, cash flow, and income statements. In the text, results are discussed for the total fleet, the Gulf shrimp fleet, the active Gulf shrimp fleet, and the inactive Gulf shrimp fleet. Additional results for shrimp vessels grouped by state, by vessel characteristics, by landings volume, and by ownership structure are available in the appendices. The general conclusion of this report is that the financial and economic situation is bleak for the average vessels in most of the categories that were evaluated. With few exceptions, cash flow for the average vessel is positive while the net revenue from operations and the “profit” are negative. With negative net revenue from operations, the economic return for average shrimp vessels is less than zero. Only with the help of government payments does the average owner just about break even. In the short-term, this will discourage any new investments in the industry. The financial situation in 2006, especially if it endures over multiple years, also is economically unsustainable for the average established business. Vessels in the active and inactive Gulf shrimp fleet are, on average, 69 feet long, weigh 105 gross tons, are powered by 505 hp motor(s), and are 23 years old. Three-quarters of the vessels have steel hulls and 59% use a freezer for refrigeration. The average market value of these vessels was $175,149 in 2006, about a hundred-thousand dollars less than the average original purchase price. The outstanding loans averaged $91,955, leading to an average owner equity of $83,194. Based on the sample, 85% of the federally permitted Gulf shrimp fleet was actively shrimping in 2006. Of these 386 active Gulf shrimp vessels, just under half (46%) were owner-operated. On average, these vessels burned 52,931 gallons of fuel, landed 101,268 pounds of shrimp, and received $2.47 per pound of shrimp. Non-shrimp landings added less than 1% to cash flow, indicating that the federal Gulf shrimp fishery is very specialized. The average total cash outflow was $243,415 of which $108,775 was due to fuel expenses alone. The expenses for hired crew and captains were on average $54,866 which indicates the importance of the industry as a source of wage income. The resulting average net cash flow is $16,225 but has a large standard deviation. For the population of active Gulf shrimp vessels we can state with 95% certainty that the average net cash flow was between $9,500 and $23,000 in 2006. The median net cash flow was $11,843. Based on the income statement for active Gulf shrimp vessels, the average fixed costs accounted for just under a quarter of operating expenses (23.1%), labor costs for just over a quarter (25.3%), and the non-labor variable costs for just over half (51.6%). The fuel costs alone accounted for 42.9% of total operating expenses in 2006. It should be noted that the labor cost category in the income statement includes both the actual cash payments to hired labor and an estimate of the opportunity cost of owner-operators’ time spent as captain. The average labor contribution (as captain) of an owner-operator is estimated at about $19,800. The average net revenue from operations is negative $7,429, and is statistically different and less than zero in spite of a large standard deviation. The economic return to Gulf shrimping is negative 4%. Including non-operating activities, foremost an average government payment of $13,662, leads to an average loss before taxes of $907 for the vessel owners. The confidence interval of this value straddles zero, so we cannot reject, with 95% certainty, that the population average is zero. The average inactive Gulf shrimp vessel is generally of a smaller scale than the average active vessel. Inactive vessels are physically smaller, are valued much lower, and are less dependent on loans. Fixed costs account for nearly three quarters of the total operating expenses of $11,926, and only 6% of these vessels have hull insurance. With an average net cash flow of negative $7,537, the inactive Gulf shrimp fleet has a major liquidity problem. On average, net revenue from operations is negative $11,396, which amounts to a negative 15% economic return, and owners lose $9,381 on their vessels before taxes. To sustain such losses and especially to survive the negative cash flow, many of the owners must be subsidizing their shrimp vessels with the help of other income or wealth sources or are drawing down their equity. Active Gulf shrimp vessels in all states but Texas exhibited negative returns. The Alabama and Mississippi fleets have the highest assets (vessel values), on average, yet they generate zero cash flow and negative $32,224 net revenue from operations. Due to their high (loan) leverage ratio the negative 11% economic return is amplified into a negative 21% return on equity. In contrast, for Texas vessels, which actually have the highest leverage ratio among the states, a 1% economic return is amplified into a 13% return on equity. From a financial perspective, the average Florida and Louisiana vessels conform roughly to the overall average of the active Gulf shrimp fleet. It should be noted that these results are averages and hence hide the variation that clearly exists within all fleets and all categories. Although the financial situation for the average vessel is bleak, some vessels are profitable. (PDF contains 101 pages)

Artisanal canoe fishing industry of the Rivers State: its economic viability and investment potentials

Consequent upon the present national call in Nigeria for all to go back to agriculture including fishing, most retrenched workers and unemployed youths from the riverine areas are taking up fishing as a legitimate and gainful livelihood. To sustain this tempo and attract more investment, the economic viability of such projects must be known. This study is an attempt to document the profitability and investment potential of artisanal canoe fishing. Socio-economic information including catches, operational cost and returns were obtained through a personal interview questionnaire survey of 240 randomly selected artisanal canoe fishermen from Bonny, Brass and Degema Local Government Areas (LGA) of the State and analyzed. With an investment cost of about 8,135, 8,490 and 6,571 and operation cost of 750, 776 and 627, the analysis showed an average monthly gross income of 1,869, 3,221 and 1,775 for the three local government areas respectively. A benefit-cost-ratio of 1:8, net present value of 400, 603 and internal rate of return greater than 50% were obtained. Since capital invested in fisheries is not tied up for long before benefits start flowing, coupled with the high IRR, it is concluded that artisanal canoe fishing would be an economically viable venture if well managed

Economic analysis of utilizing Kainji gas kiln for fish smoking in the Kainji Lake Basin of Nigeria

Marketing of smoked fish in the Kainji Lake Basin (Nigeria) has been found to be complex, traditional and inefficient. It is also said to be limited in scope due to poor handling and processing techniques, lack of storage facilities and inadequate marketing informations. The invention of Kainji gas kiln has been found suitable to overcoming poor handling and processing techniques. This paper discusses the feasibility of operating Kainji gas kiln commercially supported with adequate storage facilities and competent management hands. The financial indicators of net present value (NPV), 47,481.11, Internal rate of return (IRR) 24% and payback period of 2.3 years that are calculated confirmed that the commercial use of Kainji gas kiln is indeed profitably feasible

Coastal erosion as a natural resource management problem: An economic perspective

Unremitting waves and occasional storms bring dynamic forces to bear on the coast. Sediment flux results in various patterns of erosion and accretion, with an overwhelming majority (80 to 90 percent) of coastline in the eastern U.S. exhibiting net erosion in recent decades. Climate change threatens to increase the intensity of storms and raise sea level 18 to 59 centimeters over the next century. Following a lengthy tradition of economic models for natural resource management, this paper provides a dynamic optimization model for managing coastal erosion and explores the types of data necessary to employ the model for normative policy analysis. The model conceptualizes benefits of beach and dune sediments as service flows accruing to nearby residential property owners, local businesses, recreational beach users, and perhaps others. Benefits can also include improvements in habitat for beach- and dune-dependent plant and animal species. The costs of maintaining beach sediment in the presence of coastal erosion include expenditures on dredging, pumping, and placing sand on the beach to maintain width and height. Other costs can include negative impacts on the nearshore environment. Employing these constructs, an optimal control model is specified that provides a framework for identifying the conditions under which beach replenishment enhances economic welfare and an optimal schedule for replenishment can be derived under a constant sea level and erosion rate (short term) as well as an increasing sea level and erosion rate (long term). Under some simplifying assumptions, the conceptual framework can examine the time horizon of management responses under sea level rise, identifying the timing of shift to passive management (shoreline retreat) and exploring factors that influence this potential shift. (PDF contains 4 pages)

An economic approach to consumer product ratings

In three essays we examine user-generated product ratings with aggregation. While recommendation systems have been studied extensively, this simple type of recommendation system has been neglected, despite its prevalence in the field. We develop a novel theoretical model of user-generated ratings. This model improves upon previous work in three ways: it considers rational agents and allows them to abstain from rating when rating is costly; it incorporates rating aggregation (such as averaging ratings); and it considers the effect on rating strategies of multiple simultaneous raters. In the first essay we provide a partial characterization of equilibrium behavior. In the second essay we test this theoretical model in laboratory, and in the third we apply established behavioral models to the data generated in the lab. This study provides clues to the prevalence of extreme-valued ratings in field implementations. We show theoretically that in equilibrium, ratings distributions do not represent the value distributions of sincere ratings. Indeed, we show that if rating strategies follow a set of regularity conditions, then in equilibrium the rate at which players participate is increasing in the extremity of agents' valuations of the product. This theoretical prediction is realized in the lab. We also find that human subjects show a disproportionate predilection for sincere rating, and that when they do send insincere ratings, they are almost always in the direction of exaggeration. Both sincere and exaggerated ratings occur with great frequency despite the fact that such rating strategies are not in subjects' best interest. We therefore apply the behavioral concepts of quantal response equilibrium (QRE) and cursed equilibrium (CE) to the experimental data. Together, these theories explain the data significantly better than does a theory of rational, Bayesian behavior -- accurately predicting key comparative statics. However, the theories fail to predict the high rates of sincerity, and it is clear that a better theory is needed.

Comparison of some traits of economic importance in tilapias (Orechromis niloticus and Sarotherodon galilaeus) with particular reference to their culture in Ghana

This study was conducted to determine which of the two major tilapia species in freshwater capture fisheries in Ghana, Oreochromis niloticus or Sarotherodon galilaeus, is more suitable for breed improvement and pond culture. It compares traits of economic importance, including seed output, specific growth rate, survival and sex ratios following androgen sex reversal. The results of the study showed that the aquaculture potential of S. galilaeus compares favorably with that of O. niloticus. However, S. galilaeus may be preferred because the males and females have an equal growth rate, which allows for manual sorting to raise both sexes in monosex culture, an inexpensive appropriate technology that an ordinary smallscale fish farmer can apply.

Economic policies and the sustainable development of coastal resources in the Philippines

The link between environmental trends and economic policies is examined. The assessment of the past and present economic policies affecting the use of coastal resources in the Philippines showed that these policies have accelerated the rate of degradation of coastal resources. The current situation demands not only the reorientation of economic policies, but also other related actions to attain sustainable development of coastal resources.

A Social and Economic Characterization of the U.S. Gulf of Mexico Recreational Shark Fishery

A mail survey of tournament shark anglers and party boat shark anglers was completed to examine their fishing activity, attitudes, trip expenditures, and consumer surplus. A sample of 700 shark anglers was selected from tournaments in the Gulf of Mexico during 1990, and a sample of party boat shark anglers was drawn from Port Aransas, Tex., party boat anglers during the summer of 1991. A response rate of 58% (excluding nondeliverables) was obtained from tournament anglers. The sample of party boat shark anglers was too small to provide useful results. Tournament shark anglers reported fishing an average of 58 days per year and targeted sharks and other large marine species. Tournaments occupy a small portion of their fishing effort. If this group of anglers were not able to fish for sharks, one-third indicated no other species would be an acceptable substitute, while others were willing to substitute other large marine species. Shark trip expenditures averaged $197 per trip with a consumer surplus of $111 per trip. Based on MRFSS estimates of the number of shark fishing trips, we estimate a total of $43,355,000 was spent by shark anglers in the Gulf of Mexico with a consumer surplus of $23,865,000 for a total gross value of the shark fishery of $66,220,000. MRFSS estimates of the number of sharks landed indicate an equivalent use value of $183 per shark.

Simulated Economic Impact of TED Regulations on Selected Vessels in the Texas Shrimp Fishery

Shrimp fishermen trawling in the Gulf of Mexico and south Atlantic inadvertently capture and kill sea turtles which are classified as endangered species. Recent legislation requires the use of a Turtle Excluder Device(TED) which, when in place in the shrimp trawl, reduces sea turtle mortality. The impact of the TED on shrimp production is not known. This intermediate analysis of the TED regulations using an annual firm level simulation model indicated that the average Texas shrimp vessel had a low probability of being an economic success before regulations were enacted. An assumption that the TED regulations resulted in decreased production aggravated this condition and the change in Ending Net Worth and Net Present Value of Ending Net Worth before and after a TED was placed in the net was significant at the 5 percent level. However, the difference in the Internal Rate of Return for the TED and non-TED simulations was not significant unless the TED caused a substantial change in catch. This analysis did not allow for interactions between the fishermen in the shrimp industry, an assumption which could significantly alter the impact of TED use on the catch and earnings of the individual shrimp vessel.

Economic and social impacts of Integrated Aquaculture-Agriculture technologies in Bangladesh

This study estimated the adoption rate of integrated aquaculture-agriculture (IAA) technologies in Bangladesh and their impact on poverty and fish and food consumption in adopting households. We used a novel, simulation-based approach to impact assessment called Tradeoff Analysis for Multi-Dimensional Impact Assessment (TOA-MD). We used the TOA-MD model to demonstrate how it is possible to use available data to estimate adoption rates in relevant populations, and to quantify impacts on distributional outcomes such as poverty and food security, thus demonstrating ex ante the potential for further investment in technology dissemination. The analysis used baseline and end-of-project survey data from WorldFish-implemented Development of Sustainable Aquaculture Project (DSAP), promoting IAA. This dataset was used to simulate adoption and assess its impacts on poverty and food security in the target population. We found that, if adopted, IAA had a significant positive impact on reducing poverty and improving food security and income.

Economic feasibility of composite fish culture in leased-in village tanks of Kanyakumari district: an invesment analysis

Kanyakumari district belonging to the high rainfall zone has resource advantages for composite fish culture in the leased-in village tanks. There are more than 400 fish farmers operating in leased-in tanks following composite fish culture under the FFDA programme. To estimate the economic feasibility and financial viability of the enterprise, the present study was taken up. 38 fish farmers selected from the district provided the necessary information like capital investment, costs and return and constraints. The data collected were analysed and a farm nearest to the average farm situation was taken as the representative farm. Investment criteria like PayBack Period (PBP), Simple Rate of Returns (SRR), Net Present Value (NPV) and Benefit Cost Ratio (BCR) were estimated taking into account a period of 10 years, the period for which the village tanks are leased-out to fish farmers under the FFDA programme. The analysis indicated the profitability of composite fish culture in village tanks in the district and the results are discussed with recommendations.

Techno-economic analysis of production and marketing of marine by-products in India

Marine by-products coming under the ancillary products group found many applications in pharmaceutical and industrial sectors. Although many of these products are fetching very high price at the export market, adequate statistics regarding their current production, marketing and utilisation is lacking. The present analysis deals with the production potential, level of exploitation, uses, export growth rate and potential for the future of some of these marine by-products. The analysis revealed that an estimated quantity of 205 t. of shells, 10 t. of gastropod operculum, 4,932 t. of shark liver oil and 4,384 t. of shark cartilage could be produced annually in India with the current landings. The production potential of chitin is estimated as 3,560 t. from shrimp shell wastes and 1,354 t. from crab shell wastes. The high unit value of different products clearly indicates the scope for their development by evolving appropriate utilisation and marketing strategies.