True or false: If the fishery were owned by just a single owner (as opposed to open access), the equilibruim effort would be the economically efficient level (E*)

Question

BlackTom AI · Accepted Answer

Property rights internalize the stock externality: a sole owner chooses effort where the marginal benefit of more effort equals the marginal cost, yielding the economically efficient effort E* (True). Relevant concepts: - Bioeconomic harvest H(E) depends on fishing effort E and stock size; steady-state stock adjusts so harvest is a function of effort, H(E). - A profit-maximizing sole owner chooses E to maximize π = p H(E) − c E (p = price per unit catch, c = cost per unit effort). - Open-access fishing continues until economic profit is driven to zero, so effort satisfies average revenue = average cost: p H(E)/E = c. Step-by-step reasoning and equations: 1. Sole-owner first-order condition: dπ/dE = p dH/dE − c = 0, so p · H′(E*) = c. The owner equates marginal revenue from an extra unit of effort to the marginal cost. 2. Open-access equilibrium requires zero profit: p H(EOA) − c EOA = 0 ⇒ p · H(EOA)/EOA = c. Open access equates average revenue per unit effort to cost. 3. For the biologically realistic H(E) (H(0)=0, H′>0, H″<0 — increasing and concave), the average catch per unit effort H(E)/E equals H′(ξ) for some ξ in (0,E) by the mean value theorem. Because H′ is decreasing, H′(ξ) > H′(E) when ξ < E. 4. Evaluate at E*: H(E*)/E* = H′(ξ) > H′(E*) = c/p, so p H(E*)/E* > c. That means at the profit-maximizing E*, average revenue exceeds cost; open-access entry will continue until average revenue falls to c, which requires increasing effort beyond E*. Thus EOA > E*. Why the correct answer is True: - A single owner internalizes the effect of current effort on future stock and sets effort where marginal benefit equals marginal cost (p H′ = c), which is the efficient condition. Open access instead drives effort up to where average revenue equals cost, producing excessive effort and lower stock. Why the other option (False) is incorrect: - Claiming False would mean the sole-owner equilibrium is not efficient; but the owner’s first-order condition explicitly yields the economically efficient E*, unlike open access which yields overfishing. Conclusion: The statement is True — with a single owner the equilibrium effort equals the economically efficient level E*, matching the provided answer.

True or false: If the fishery were owned by just a single owner (as opposed to open access), the equilibruim effort would be the economically efficient level (E*)判断题

类似问题

Which answer choice explains why furanoses and pyranoses can be reduced by sodium borohydride despite having no carbonyl functional groups.

Which of the following statements describes a glycoside?

Which of the following structures represents chitin?

In solution, glucose exists in

According to Xenophanes, what should be avoided at a symposium?

What is "kottabos"?

Why are there so many naked figures in vase iconography?

Why was it necessary to have a "hydria" as part of the ceramic vessels used at a symposium?

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单