Potential Impact of Seasonal Closures in the U.S. Lobster Fishery

Open access in the U.S. fishery for American lobsters has created seasonally concentrated landings. This analysis examines the impact of seasonality upon the market and also analyzes the possible use of seasonal closures to counteract this seasonality. Monthly price response functions are estimated using principal components regression. A linear programming model, which uses the monthly price response equations, finds that the gross revenue maximizing pattern of U.S. landings would increase U.S. revenues by 18 percent. Furthermore, the increased concentration of U.S. landings that has occurred between the 1960s and 1980s has decreased revenues to U.S. fishermen by an estimated 6 percent. We find that one or two month closures will not increase gross revenues. Closures for extended periods (such as August to November) might increase gross revenues modestly, but such extended closures face serious political obstacles. Because this is an open access fishery, resource rents will not be generated from any increase in revenues. Higher revenues would seem to be consistent with other political objectives, such as increasing economic activity in fishing communities.