Indecon International Economic Consultants
Total Page:16
File Type:pdf, Size:1020Kb
An Economic/Socio-Economic Evaluation of Wild Salmon in Ireland Submitted to the Central Fisheries Board by Indecon International Economic Consultants INDECON International Economic Consultants www.indecon.ie April 2003 © Copyright Indecon. No part of this document may be used or reproduced without Indecon’s expressed permission in writing. Contents Page Glossary of Terms i Executive Summary iii 1 Introduction and Background 1 Introduction 1 Background and Context to Review 1 Scope and Terms of Reference of Evaluation 2 Approach 4 Acknowledgements 4 2 Review of Existing Research on Socio-economic Value of Atlantic Salmon 5 Irish-based Research 5 International Evaluations on the Economic Value of Salmon 13 Conclusion 18 3 Review of Salmon Management in Ireland 19 Developments in Salmon Management Policy 19 Historical Trends in the Salmon Catch 28 Conclusions 39 4 Economic Impact of Commercial Salmon Fishing 41 Regional Structure of Commercial Salmon Catch 41 Analysis of Commercial Catch by Type of Fishing Licence 46 Indecon Survey of Commercial Salmon Fishermen 49 Estimates of Total Commercial Salmon Revenue 59 Summary and Conclusions 68 Indecon April 2003 i Contents Page 5 Economic Impact of Salmon Angling 70 Regional breakdown of Rod & Line Salmon Catch 70 Value of Overseas Salmon Tourism 72 Value of Domestic Salmon Angling 95 Indecon Survey of Tourism Interests 104 Analysis of Salmon Angling Accommodation 108 Summary and Conclusions 110 6 Views of Commercial Salmon Fishermen, Tourism and Angling Interests 111 Views of Commercial Salmon Fishermen 111 Views of Tourism and Angling Interests 118 7 Estimation of Socio-Economic Value of Wild Salmon 133 Scenarios for Management of Commercial Fishery 133 Scenarios for Commercial Salmon Fishing Revenue 135 Scenarios for the Salmon Angling Sector 143 Present Socio-Economic Value of Salmon Angling 145 Value of Commercial versus Rod & Line Salmon 148 Conclusions 150 8 Recommendations re Options/Models for Sustainable Management 151 Review of Salmon Management in Other Countries 151 Recommendations re Models for Management of Wild Salmon Resource in Ireland 156 Conclusions 162 Annex 1 Summary of Main Submissions Made to Consultancy Team 163 Annex 2 Copies of Survey Questionnaires 170 Indecon April 2003 ii Glossary of Terms Glossary of Terms Marginal Willingness to Pay. A person's willingness to pay for one more unit of a good or service. From the demand function for a good or service it can be read as the price the person is willing to pay for a given quantity of that good/service. Marginal Value. The maximum amount that an individual is willing to pay for one extra unit of a resource or for the extra outcome(s) resulting from its provision. Differs from the average value, which equates to the mean value of a resource over a number of units. Mean. The mean is the average of the scores in the population. Numerically, it equals the sum of the scores divided by the number of scores. The mean average is, however, subject to greater influence by relatively high or low values (‘outliers’) in the sample. Median. The median of a population is the point that divides the distribution of scores in half. Numerically, half of the scores in a population will have values that are equal to or larger than the median and half will have values that are equal to or smaller than the median. This statistical measure is less influenced by extreme low or high values in a sample than is the mean average (defined above). Multiplier. The multiplier is concerned with how national income changes as a result of a change in an injection, for example investment. The multiplier was a concept developed by the economist, John Maynard Keynes, which stated that any increase in injections into the economy (investment, government expenditure or exports) would lead to a proportionally bigger increase in National Income. This is because the extra spending would have knock-on effects creating in turn even greater spending. The size of the multiplier would depend on the level of leakages. It can be measured by the formula 1/(1-MPC-MPM) where the MPC is the marginal propensity to consume and the MPM is the marginal propensity to import. Net Benefit. The net overall economic benefit derived from an activity (such as salmon tourism angling). They differ from gross benefits in that they represent the net contribution to Irish economic activity after subtracting expenditure on imported inputs and the opportunity cost of labour and other resources used in supplying such services. Indecon April 2003 i Glossary of Terms Opportunity Cost. The value of the best foregone alternative use for a resource. In the case of the salmon recreational angling sector, the net benefit of the sector to the economy must take account of opportunity cost of labour and other resources used in supplying products and services (e.g. hotels and catering services) purchased by overseas anglers where these resource may be put to use elsewhere in the economy. Present Value. The present value is a mathematical formula used to determine how much money should be invested today to result in a certain sum at a future point in time. It is the discounted value of a future stream of payments or receipts calculated by applying an appropriate discount rate to each future payment of receipt. Revenue. The total value of receipts during a specified period. In the case of salmon fishing, revenue represents the value of sales of salmon landed. Skewness. A measure of the lack of symmetry in a statistical distribution of data points. Data from a positively skewed (skewed to the right) distribution have values that are bunched together below the mean, but have a long tail above the mean. Data from a negatively skewed (skewed to the left) distribution have values that are bunched together above the mean, but have a long tail below the mean. Standard deviation. The standard deviation is a measure of the variability present in a data sample. It represents the squared sum of the difference between the mean and each data point in a sample. A high standard deviation points to a high degree of variance within a sample. Value-added. The value of output minus the value of all intermediate inputs used in production, representing therefore the contribution of, and payments to, primary factors of production. In the case of the wild salmon sector, value added may represent the additional value created in downstream industries such as processing. Indecon April 2003 ii Executive Summary Executive Summary Background and Context This report represents an independent economic/socio-economic evaluation of wild salmon in Ireland. The report has been prepared for the Central Fisheries Board. The evaluation addresses the requirements for the long-term sustainable management of wild salmon stocks, within an economic and socio-economic context, to ensure the viability of this important resource. The wild Atlantic salmon (Salmo salar) fishery in Ireland comprises a commercial and a recreational fishery. The commercial fishery comprises a number of elements, depending on the method of harvesting. The largest, in terms of the proportion of commercial salmon harvested, is the drift net fishery, which extends offshore to 6 miles and accounts for 87% of the total commercial salmon catch. The draft net fishery is confined to the estuaries and tidal stretches of the river systems and accounts for just over 11% of the commercial salmon catch. The recreational fishery is confined to the river systems, of which over one hundred are recognised as salmon and sea trout fisheries. Salmon angling in Ireland attracts a large number of participants, including both local anglers and overseas visitors, and in 2001 close to 33,000 salmon/sea trout licences were sold to anglers. The Central and Regional Fisheries Boards are the statutory agencies responsible for inland fisheries in Ireland and operate under the aegis of the Department of Communications, Marine and Natural Resources. The principal function of the Central Fisheries Board is to advise the Minister for Communications, Marine and Natural Resources on policy in relation to the conservation, protection, management, development and improvement of inland fisheries, while the regional fisheries boards have responsibility for the implementation of policy across the seven fisheries board regions. In addition, the National Salmon Commission was established in 1999 to assist and advise the Minister on the management of the national salmon resource and, in particular, in relation to the operation of the wild salmon and sea trout tagging and logbook scheme. Scope and Terms of Reference The overall objective of the study is to provide an “economic/socio economic evaluation of wild salmon in Ireland.” In line with the terms of reference, this study entails: • Consideration and quantification of the economic/socio economic value and importance of the commercial wild salmon fishery in Ireland; • consideration and quantification of the economic/socio economic value and importance of the salmon rod angling fishery in Ireland; • setting out options/models on how both segments of the industry should be sustainably managed from an economic/socio economic perspective in the future; and, • while this is a national study, consideration is given to the importance of wild salmon to coastal and rural communities. Indecon April 2003 iii Executive Summary Review of Existing Research on Economic Evaluation of Wild Salmon The evaluation began by reviewing a number of Irish-based and international studies concerning the economic/socio-economic value of the Atlantic wild salmon resource. In relation to the international research, existing studies in respect of the salmon fisheries in Great Britain, Iceland and Canada have each pointed to a substantial gap between the economic values attributed to commercial and recreational salmon fishing, with recreational activity typically yielding a large multiple of the values estimated for commercial salmon fishing.