11. OTHER OBJECTIVES AS CONSTRAINTS ON ABILITY TO ACHIEVE ECONOMIC SURPLUS

It has been argued above that economic surplus is at the heart of the problems and the potential gains associated with fisheries exploitation, and that for this reason both policy and research should focus on this concept. However, it is clear that policy-makers can and do pursue objectives other than economic surplus. One way to look at these other objectives would be as constraints on the ability of the system to achieve economic surplus. This will give an idea of the cost to society of trying to achieve nonefficiency goals using particular policy instruments. The section below very briefly discusses three nonefficiency goals which are often very important in policy debates. It is recognised that the issues go far beyond what is discussed here. The aim is to focus on some important issues that need to be considered and which might be the topics of future research.

11.1 Gender issues

Williams and Nauen (1996) identify the important role played by women in West African fisheries, especially in trade, marketing and processing. Given that increasing net value-added is the main way forward in fisheries exploitation, this is clearly an important role. A number of researchable constraints can be identified, in particular the adequacy of capital markets. It may also be useful to carry out extension activities concerning fish handling and preservation, especially on the use of ice, and the importance of quality.

Given the importance of the above issues, they may well top the list in an economic-surplus based evaluation. However, even assuming that they did not, it would remain a legitimate policy choice to argue that equity issues are of such over-riding importance that research must focus on issues of relevance to women so as to improve their position and role within the fishery system. It must be recognised, however, that this could impose significant opportunity costs in terms of other research that will no longer be carried out. But perhaps the key question is whether a sustainable, long-term improvement can be expected. First, will the research results be adopted? And second, will women able to hold on to the gains made? In more general terms, is it realistic to expect research to be able to run counter to broad sociocultural factors that go beyond the fishery sector?

11.2 Poverty

Many users of fisheries resources in developing countries are relatively and absolutely poor. Development projects and agencies focus on the poor as a target beneficiary group but this raises many difficult questions.

A first question that must be addressed is whether a meaningful definition of poverty can be developed. Ravallion (1996) reviews attempts to measure poverty pointing out that the standard approach, the headcount index (the proportion of the population below some arbitrarily-defined poverty line), is seriously flawed, not least because if those below the poverty line become poorer, with no changes elsewhere, then the index will not change, even though it is intuitively clear that poverty has worsened. This flaw was noted by Sen (1976, quoted by Ravallion), yet the headcount index remains the most popular measure because, according to Ravallion, it has proven difficult to develop a simple alternative.

A second question is whether the poor will be able to retain any gains that they may make. It is necessary to investigate the extent to which any gains in productivity will be expropriated either through rents or through price changes. Bardhan (1996, p. 1348), makes a similar point when discussing attempts to provide subsidised credit for the poor, arguing that "wealthy borrowers have often appropriated the credit subsidies meant for the poor".

A third question is how can fisheries policy best help the poor? Often there seems to be an assumption that the poor must be helped to become better exploiters of fisheries resources. However, the best way to help the poor may not be to help them to become better fishers, nor to encourage them to become fishers at all, but to use the wealth of the fishery to create alternative employment opportunities for them. In this view, poverty alleviation is considered to be a macroeconomic, and not a sectoral issue (save in the exceptional case of a very large fishery sector). Attempts to improve the incomes of the poor in the fisheries sector alone seemed doomed to failure because incomes in the fisheries sector are linked to those in the rest of the economy. If a policy successfully improves incomes in the fisheries sector, the relative attractiveness of this sector will increase, attracting more fishers and restoring the equilibrium position where opportunity incomes are earned. The new equilibrium can emerge via a combination of price and quantity effects. The problem is that quantity effects in particular are likely to run counter to conservation goals. Increased numbers of fishers will generally mean lower fish stock sizes.

Much emphasis is currently being put on the "sustainable livelihoods" approach as a means of achieving poverty eradication (see e.g. Carney, (1998)). Singh (in Carney, p. 205), emphasises that sustainable livelihoods is an approach and that it would not make sense to talk of sustainable livelihoods projects. Presumably therefore it is important to identify projects which enhance the features of sustainable livelihoods (Singh identifies five major ones: coping with shocks, economic efficiency in production, social equity, environmental soundness and ability to continue once support is withdrawn). It will be evident from what has been said above that the view taken in this paper is that research can most contribute to sustainable livelihoods via the impact that it has on the economic efficiency of production.

Attempting to alleviate poverty by focussing on the poorest groups suggests that the structure of income can be changed. Table 4 is interesting in this respect. It presents some (rather old and somewhat controversial) data on income inequality across countries. What is noteworthy is that regardless of income level, from the least to. the most developed countries, income distribution has a quite remarkable similarity. As measured by the Gini coefficient, it is apparent that income inequality initially gets worse as development proceeds but as higher income levels are reached the level of inequality falls (but is very far from removed). Similar evidence exists concerning the development of individual countries. One striking feature is the way in which income inequality is reduced: it is not by the poorest segment becoming wealthier, but by the very wealthy becoming poorer (relatively). In fact, the relative position of the poorest 20% of society is actually worse in the richest countries (5% of GDP) compared to the poorest countries (7% of GDP). Similarly the position of second quintile (21- 40%) does not change significantly across the groups. Most of the gains go to the middle groups (41- 80%). The group from 81-95% improve their position early on and then broadly maintain it.

It is important to note that all these comparisons are in terms of relative positions. There are important differences also in absolute levels: the very poor in the first group will be very poor indeed so that the fact that they receive relatively more than those in developed countries is likely to be of little comfort. Given that income inequality is a pervasive feature across both time and space, it would appear to have an important economic role. It also looks likely to be extremely difficult to eradicate. The evidence presented in Table 4 suggests that programmes which concentrate on poverty alleviation, and especially on assisting the very poor, face a formidable challenge.

Table 4. Average income shares by country group according to GDP per capita
in 1965 dollars (from Thirlwall, 1994, pp.33-34)

The apparent difficulty of changing the structure of income distribution would seem to emphasise the importance of raising the overall growth rate of the economy. In this context, once again, the fisheries sector can most contribute as a creator of wealth, which could, if desired, be invested to enhance the lot of the poor, most obviously through supply-side policies (funded by resource rents) such as education and training programmes for the poor. As Bardhan argues (1996, p. 1345, emphasis added) "in the more recent literature on poverty there is a better appreciation of the fact that market-driven economic growth need not be inconsistent with poverty alleviation. In many countries, in East and Southeast Asia in particular, fast outward-oriented growth has been associated with substantial reductions in mass poverty. In general, the most important way for economic growth to help the poor is by expanding their opportunities for productive and remunerative employment." Simply adding more and more people to a fixed resource base does not seem to achieve this expansion, taking the wealth and investing it does.

11.3 Employment

The widespread situation of free and open access to fish resources has led to the fishing industry being seen as the employer of last resort in many countries. In MacKenzie's famous observation (1979) "fishermen are not poor because they are fishermen, they are fishermen because they are poor". Improving the economic performance of the fishing industry often involves reducing the exploitation rate and this may mean the loss of some employment. It is important to note however that employment issues relate more to the way in which the fishery is managed than to the level to which it is managed. Within the limit to the exploitation rate imposed by the biological resource constraint, some increase in employment can usually be achieved by requiring that the fishing industry use less than the best available technology, but quite why one sector of the economy should be condemned to inefficiency in this way is usually not justified. One clear policy guideline which emerges from an employment objective is not to subsidise capital since otherwise standard substitution effects can be expected. Regrettably, many countries have paid subsidies to their fishing industries to modernise, with predictable adverse effects on the quantity of labour employed for a given exploitation rate, and the exploitation rate for a given quantity of labour. If employment is an important goal then it may be useful to promote research which creates employment. However, careful consideration should be given to the long run consequences of such decisions.