Bioeconomics of interdependent fishery and forestry resource

This study develops a conceptual model to evaluate the linkage between forestry activities and the fishing of salmonids. Emphasis on two functions characterizes the analysis in this study. The first one is a recruitment function that includes an environmental disturbance variable so as to determine the contribution of environmental disturbances to recruitment. The second one is a function that distinguishes between logging and planting effects on the environmental disturbance variable so as to determine forest decision variables contribution to environmental disturbances. Adding the payoffs of the fishery, which reflects the implicit value of recruitment, to the forestry valuation function removes the externality associated with the interaction of forestry decisions and fish production, and gives an optimal forestry activity level conditional on the fishery market conditions. Since the implicit value of recruitment depends simultaneously on forestry management and market conditions in the fishery, changes in either sector can be translated into changes in the costs imposed on the fishery by alternative levels of forestry activities. These costs depend on the size of the spawning stock and hence on how the fishery is managed. These results indicate that the bioeconomic processes for this reciprocal dependency between fishery and forestry resources may call for optimal harvest and logging and planting rates that are contrary to the standard results of single resource production.