Examining techno-economic interactions among fish species: A case of small-scale demersal fishery

Using the multi-product dual revenue function framework, this paper examines the nature and extent of technical and economic interactions among five demersal species of Al-Batinah demersal fishery, Oman during the 2010–2016 period. The parameters of the system of output supply functions are estimated using Zellner's seemingly unrelated regressions (SUR) technique. The likelihood ratio test in relation to the structure of the multi-output production technology rejects the null-hypothesis of input-output separability and non-jointness in inputs. These results suggest that the underlying production technology is non-separable between the outputs and the quasi-fixed input, and the harvesting level of one species is likely to have spill-over economic effects on the harvesting levels of others. The own-price elasticities of output supply are found to be positive, inelastic, and statistically significant in four out of five cases suggesting that, other things being equal, fishers' supply decisions are influenced by the prevailing market prices of outputs. The estimated values of the cross-price elasticity of supply are negative, inelastic and statistically significant at the 5% level for eight output pairs. The calculated values of the Morishima elasticity of substitution (MES) indicate the presence of substitutability between ten output pairs. The cross-price elasticity estimates are in the range of −0.001 (between Emperor and Catfish) to −0.275 (between Seabream and Grouper) which is lower (in absolute value) than that of the MES estimates. The magnitudes of the cross-price elasticity and the MES estimates indicate the extent of spill-over effects of one species on the other and signal the extent of species targeting by fishers. A statistically significant spatial, seasonal, and inter-annual variability is observed in all species cases. Finally, the implications of the findings are discussed from the perspective of developing effective management approaches, achieving sustainability of fisheries resources and improving fishers' socio-economic conditions stipulated in the Five-Year development plans for the sector.