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Beyond the Tragedy in Global Fisheries$

D. G. Webster

Print publication date: 2015

Print ISBN-13: 9780262029551

Published to MIT Press Scholarship Online: September 2016

DOI: 10.7551/mitpress/9780262029551.001.0001

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Investment and Innovation

Investment and Innovation

Chapter:
(p.73) 3 Investment and Innovation
Source:
Beyond the Tragedy in Global Fisheries
Author(s):

D. G. Webster

Publisher:
The MIT Press
DOI:10.7551/mitpress/9780262029551.003.0003

Abstract and Keywords

A second key economic response is investment in new vessel and gear technologies that reduce costs of production and increase the efficiency of fishing effort. This chapter describes how such investment was shaped by a combination of overfishing in historical grounds and exogenous technological breakthroughs that were appropriated by fishers in their quest to maintain profits. Each innovation helped to dampen cost signals and widen the profit disconnect, particularly for fishers with access to capital. This generated stratification in the industry that was a critical determinant of governance response as described in Part II.

Keywords:   Technological change, innovation, availability of capital, industry stratification, mechanization, industrialization, aquaculture

The second major fisher response predicted by the AC/SC framework is investing in innovative technologies that increase efficiency or otherwise reduce the marginal (per unit) costs of production for any given stock size. Unlike geographic expansion, innovation for efficiency does not increase the amount of fish available for exploitation. Instead, this response dampens the cost signal and widens the profit disconnect. For much of history, this effect was limited by the technologies available in the structural context, as explained in the general AC/SC application to fisheries described in chapter 1. However, the rate of innovation generally is increasing over time, which catalyzes additional innovation in fish production technologies. In fact, some economists estimate that, at its current pace, technological change could improve efficiency enough to completely negate any cost increases due to declining stock size (Hannesson, Salvanes, and Squires 2010; Squires and Vestergaard 2009). Access to capital is another limit on innovation that is determined by both resources and governance in the structural context. Since investment helps fishers and secondary industry actors to accumulate capital, it acts as an endogenous driver of innovation. Globalization of finance and trade can also magnify investment exogenously by providing greater access to capital in many parts of the world and fostering the escalation in technological advancement described above. Thus, the cost signal, which was quite strong for much of history, has been eroded over time through investment in innovation. This has important implications for our understanding of fisheries economics and the common pool resource (CPR) dynamic more broadly.

Most economists blame any and all efficiency improvements on the “race for fish” created by the CPR dynamic, but there is considerable evidence that such investments would occur even if fisheries were privately (p.74) owned (Ward et al. 2004). Technological innovation is a hallmark of capitalism and occurs in all industries, including those in which private owners exploit natural resources (Grossman and Helpman 1994). In fisheries specifically, some of the earliest innovations occurred under conditions of enforced monopoly or well-established sea tenure. Of course, other important innovations occurred under conditions of open access, but only when sufficient capital and technological knowhow were available to fisheries entrepreneurs. Furthermore, the historical evidence clearly shows that some fishers acted as entrepreneurs while the majority either followed along or actively resisted changes (see chapter 5). One reason for this could be that most fishers did not have access to sufficient capital to obtain the new technologies, but it also stemmed from pure reluctance by most fishers to change their methods (Chapman 1966). In contrast, fisheries entrepreneurs such as Christian Salvensen (whose company commissioned the first factory trawler) and Harold Medina (who introduced the use of spotter planes) demonstrated persistent willingness to take large risks to improve their operations. When analyzing the growth in fishing efficiency, it is difficult to distinguish between the common pool resource dynamic and these entrepreneurial efforts. However, it is clear that the latter are important internal drivers of the profit disconnect and should not be ignored.

Heterogeneity in willingness or ability to invest in innovation generates stratification in the size of fishing operations. Strata are delineated both by the size of vessels used and by the number of vessels owned by a single individual or company. Here, an ecological metaphor is apt, since fishers and fishing companies of different sizes survive together by fitting into their own economic niches. For instance, even in the 1800s people recognized that smaller-scale vessel-gear combinations brought in higher-quality fish than the larger steam trawlers. Along with government regulation, this helped the sail-based fishery to survive and eventually evolve into a motor-based fishery with approximately the same scale and ownership structure (J. T. Jenkins 1920; Robinson 1996). Many other niches exist and can be defined based on local demand, quality-quantity tradeoffs, and even physical, social, or political limitations that inhibit economies of scale in fisheries. Nevertheless, fishers in each niche either find ways to reduce costs over time or they are forced to exit the fishery when overexploitation and overcapitalization set in. This competition—which, again, would occur even without the CPR dynamic—causes the profit disconnect to expand for every stratum of the industry as efficiency improvements shift the equilibrium level of production farther away from the bio-economic maximum.

(p.75) The appropriation of new technologies is also stratified temporally, as fisheries evolve in cycles of slow growth followed by sudden technological advances. This is a dynamic process, but, unlike dynamic models such as those outlined by Clark (2005), these cycles do not converge to a stable equilibrium; rather, they move between periods of growth and recession that oscillate around a longer-term positive trend, as predicted by Schumpeter ([1942] 1976). However, the infinite growth predicted by Schumpeter is not possible, in fisheries or in other sectors, because of physical, biological, and ecological limits in the resource base. In particular, as has already been noted, the technological innovations in capture production do not expand the resource base; rather, they increase the rate of depletion in commercial fisheries due to improved effectiveness and because of increased investment in fishing capacity. This chapter shows how these cycles of innovation increased the efficiency of fishing operations over time, widening the profit disconnect and amplifying the core problems in the action cycle. Section 3.1 covers the evolution of vessel and gear technology and section 3.2 describes improvements in fish-finding technologies. Both of these sections focus on the roles of technological catalysts, globalization, and entrepreneurship as well as the CPR dynamic. Lastly, section 3.3 briefly shows how aquaculture is a separate response from other types of investment in efficiency and how, as practiced today, marine aquaculture is not a viable solution to the core fisheries problems of overexploitation, overcapitalization, and ecosystem disruption.

3.1 Vessels and Gears

Cycles of advancement in vessel and gear technologies can be divided into two categories: gradual change and sudden innovation. On one hand, fishers can make small, gradual modifications that steadily improve efficiency, either by reducing inputs (e.g., a more efficient engine) or by increasing their ability to harvest fish (e.g., gear improvements). On the other hand, stepwise improvements result when capital, technology, and entrepreneurship come together to introduce a new vessel-gear combination that is substantially more effective than existing configurations. Research on individual fisheries suggests that many small changes to existing fishing operations can be important precursors to stepwise growth (Hannesson, Salvanes, and Squires 2010; Rijnsdorp et al. 2008). This section focuses on well-documented periods of stepwise transformation in fisheries technologies; it also shows how many of the advances of the 19th and 20th centuries contributed to the profit disconnect for fishers filling multiple economic niches.

(p.76) 3.1.1 Manpower

There are a number of ancient methods for catching fish without tools; some survive today in indigenous cultures and as sporting events. Because these techniques are not easy to master and tend to be time consuming, early fishers had considerable incentive to invest their energies in the development of more effective technologies. Over time, people developed fishing gear of different types, including projectiles such as spears and harpoons, many kinds of nets and traps, and fishing lines, which were used with various types of poles, hooks, and bait. Artisanal fishers still use smallscale labor-intensive devices and so are much less efficient than commercial fishers (FAO 2012c). In the past, fishers were constrained both by existing technologies and by access to capital; in modern times the latter is the primary determinant of the scale and the efficiency of fishing effort. This subsection describes how various gear improvements evolved prior to the industrialization of fisheries in the 1800s.

Line Fisheries

Much as with exploration, population growth and the development of civilizations drove innovation in fishing technologies for much of history. Often, communities would invest in large-scale technologies such as beach seines, fish traps and weirs, or relatively large boats in order to take advantage of the periodic appearance of schools of fish or pods of marine mammals (Kalland 1984; Royce 1987; J. T. Jenkins 1921). To increase commercial production of the popular bonito, early Japanese fishers developed a rudimentary version of the pole-and-line technique that is now used by industrial-scale vessels called “baitboats.” A fisher using this method first “chums” the water with baitfish. Once the targeted fish are in a frenzy, the fisher hooks individual fish and hauls them aboard using a device that is similar to a recreational fishing pole but which has a fixed, short line. Figure 3.1 depicts a contemporary version of this ancient technique. The largest Japanese pole-and-line vessels from the early 1900s accommodated 30–40 fishers working off both sides of a vessel and could store 18–36 tonnes of fish in onboard salt-water wells. They would sometimes travel hundreds of miles from the coast to fish (Suisankyoku 1915; Joseph 2003).

Off the coasts of Europe and the Mediterranean, hand-operated long-lines (also called trawl lines) were the first gear known to have been used in commercial fisheries. Early hand longlines consisted of long ropes made of hemp holding many baited hooks that would be set in the water, usually weighted down to target demersal species. Lines were set and hauled in by a single fisher who would remove the catch, then rebait and reset (p.77)

Investment and Innovation

Figure 3.1 A Japanese pole and line vessel

Source: Suisankyoku 1915.

the line. Valuable fish were kept; “trash fish” were discarded or used as bait (Gibbs 1922). This ancient technology persisted for many centuries with incremental improvements such as preservation of the lines through tanning (in Europe) or treatment with the juice from unripe persimmons (in Japan), which helped to prevent damage due to constant soaking in salt water (Okoshi 1884). Nevertheless, there were few step-wise improvements until the Middle Ages; even then, vessel technology changed rather than gear technology.

As noted in chapter 2, the growth of trade and increases in warfare around the Mediterranean led to the production of larger and faster sailing vessels in 14th-century Europe. Fishers with sufficient access to capital started purchasing ships called schooners or hookers, depending on the region and the time. These vessels were specifically used to target cod and other demersal species in the North Atlantic, using hand longlines. In that fishery, a large sailing vessel, typically with a tonnage of 35 tons (gross), carried about eight small boats called “dories” stacked on deck. Sailors doubled as fishers and vice versa as each man, or sometimes a pair of men, would take a dory out away from the ship and set a line up to a mile long, with hundreds of hooks. By developing this mother-ship configuration, European fishers took advantage of larger and faster sailing vessels that were (p.78) exogenously developed for the navy and the merchant marine without any alterations to their fishing gear. Indeed, this innovation multiplied the power of a single schooner tenfold, since lines were often set from the main vessel as well as from the dories (Gibbs 1922). The primary drivers of innovation were increasing demand—and related price signals—in addition to the CPR dynamic.

It is important to note that hand longlines and gear of similar scales were also used during this period in coastal fisheries in Japan, China, India, and other parts of the world, but that those fisheries did not develop the mother-ship configuration. There are several reasons for this. First, in much of the world large vessels powered by sails were not available. Even in China and Japan, where such vessels certainly existed, they were not used for fishing, primarily because fishers had neither the status nor the capital necessary to purchase them. Stringent social norms reinforced the existing class structure, in which fishers were generally categorized as laborers, and prevented entrepreneurship of the magnitude needed to transform small-scale coastal fisheries into large-scale commercial enterprises (Kalland 1995; Yen 1910; Day 1884; Adams 1884a). Governance aspects of the structural context could also limit innovation, even in this early period. For example, Chinese regulations prohibited the construction of large fishing vessels as part of an anti-piracy campaign during the Qing Dynasty (1644–1911 CE). Officials feared that fishers would collude with pirates or turn to piracy themselves, so they limited fishers to small vessels that would stay near shore and were easier to monitor for illegal activities (Muscolino 2009). Therefore, even though demand was increasing in China just as in Europe, fishers were prevented from taking advantage of higher prices by regulation and lack of access to capital—both of which are important components of the AC/SC framework.

Net Fisheries

In contrast, the merchant classes of Europe in the Middle Ages saw fisheries as a major foundation of their wealth and invested heavily in innovation. As a result, Europe was the primary crucible of fishery development until the early 20th century. The first great example of coordinated investment in commercial fishing comes from the Hanseatic League, a group of German towns that dominated production of Atlantic herring in the 13th and 14th centuries. The League is often called a proto-state. Though there was no sovereign, its actions were formally coordinated by a Grand Council. However, the Hanseatic herring fleets were Danish, not German, and centered on the port of Scania, which became famous for its high-quality herring products. As merchants and governors, the Hansa provided (p.79) funds to help purchase these boats, invested in processing facilities along the Danish coast, and strictly regulated the industry to minimize costs and maximize prices. They also protected the fleets from pirates, reducing the costs to fishers even further (J. T. Jenkins 1920; Zimmern 1889). Thus, even though Danish fishers were relatively poor, because of capital investments by the Hanseatic League they had access to greater resources in the structural context, and their fleet was the largest and most advanced of the period. In 1382, one observer estimated somewhat optimistically that the Danish fleet consisted of 40,000 boats and 500 large freighters (J. T. Jenkins 1920). This may seem high, but the ships were still small relative to modern fishing vessels and it is not likely that the stocks were at all overfished at the time. Thus, the Hansa profited from their investments in the fishery but did not contribute to a profit disconnect per se.

Although the Hanseatic League remained powerful in the northeastern Atlantic until the 17th century, the Dutch took over from the Danes as major producers of pickled herring in Europe in the late 1400s—partly because the fish moved away from Denmark and closer to Holland and partly because of investment in innovation by the Dutch. Like the Hansa, the Dutch fishing industry organized to raise capital for investment in bigger and better technologies. First and foremost, they developed a new technique of “pickling” the herring that resulted in a better and longer-lasting product than traditional salting techniques. Second, they purchased ships called “busses”, which had enough room to process the fish on board, a key step in the pickling process (Beaujon 1884; see figure 3.2). These busses were about 80 tons, more than twice as large as other fishing vessels of the time (J. T. Jenkins 1920, 105). Third, the Dutch were the first to use large gill nets to target herring (Beaujon 1884). Gill nets hang vertically in the water column and snag fish by the gills, so no bait is required. The Hansa used smaller gill nets as well as set nets, which were similar but fixed near shore. With their larger vessels, the Dutch could haul bigger and heavier nets; the larger gill nets enabled them to bring in much greater harvests, which, in turn, filled the capacity of their vessels and allowed them to supply herring to much of Europe (J. T. Jenkins 1920).

In addition to these technological innovations, the Dutch utilized an organizational innovation to target stocks farther from shore than other fleets. Dutch fishers used tender vessels called “hospital ships” to restock the fleet and transport the harvest to port, so the fishing vessels themselves would not have to return to land so often. Today, such boats are called “transshipment vessels,” but their purpose is the same. These organizational and technological advances enabled the Dutch fleets to stay out (p.80)

Investment and Innovation

Figure 3.2 Dutch herring busses.

Source: Fulton 1911.

for months at a time, following the herring from the Baltic Sea to the North Atlantic and back (Adams 1884a). At the height of their power, the Dutch harbored as many as 2,000 busses, which could harvest an average of 40 lasts per vessel each season (Beaujon 1884, 64–65). A “last” is exactly 13,200 herring, so 40 lasts is equal to 528,000 fish (Gibbs 1922, 58). For reference, if an adult Atlantic herring weighs 700 g on average, a single last would be approximately 368 tonnes and 40 lasts would be just under 15,000 tonnes. The annual value of this harvest could be more than 30 million florins, and the annual outlay for new vessels (few could be used for more than one season), gear, and supplies was about 15 million florins (Beaujon 1884, 64–65).1 With such high returns it is no wonder that the Dutch and foreign observers alike believed that herring was the basis of that nation’s wealth. Still, given the size of herring stocks, the core problems of the CPR dynamic were prevented largely by the technological limits of the structural context in this period. That is, the open access level of production was still lower than the sustainable level simply because gear and vessel technologies remained inefficient relative to the size and productivity of the fish stocks.

Although the Dutch controlled the herring fishery both economically and militarily, they were minor players in the other major fisheries of the (p.81) 17th and 18th centuries. These were the cod fishery in the northwest Atlantic and the fishery for whales in the Arctic Ocean (Beaujon 1884). There were few innovations in the fishery for cod in this period, as exploration proved more important than innovation. Schooners remained dominant in the fishery until the early 20th century, though by that time they plied the North Pacific as well as the Atlantic (Cobb 1906).

The most revolutionary technological innovation in whaling occurred in the 16th century, when a Basque named Francois Sopite invented a method of boiling whale blubber down to oil onboard ship. Much like fishing for cod and herring, whaling started as a shore fishery. Once a whale was spotted, an entire community would mobilize to kill it, tow it to shore, and process the carcass. Even when larger boats were used to target whales farther out at sea, the need for processing on shore limited the industry to local stocks. Onboard processing allowed fishers to exploit the distant whaling grounds described in chapter 2 at commercial levels. This innovation was crucial for continuation of the industry, because many coastal whale species were already heavily overexploited; it also widened the profit disconnect by reducing the cost per unit of whale oil produced (J. T. Jenkins 1921).

In the 18th century, the British took over as the major power in the North Atlantic. They also dominated fisheries for herring and cod in this period and began targeting other species like haddock and plaice at commercial levels. Some of their dominance was due to the Industrial Revolution, which reduced the cost of inputs like nets and gear while providing capital for investment to expand fishing capacity (J. T. Jenkins 1920). Naval superiority was also pivotal during this period, because fishing grounds were often contested and piracy remained widespread (see chapter 5). In addition, changes in European preferences, including an increase in demand for low-priced fish, helped the British edge out the Dutch (see chapter 4). Most of these changes were exogenous, but one endogenous innovation was necessary for Britain’s ascendency as a major fish producer: the invention of the beam trawl. Trawls are nets that can be dragged across the ocean floor or through the water column to harvest fish. They are used mainly to target plaice, halibut, and other demersal species, which were valuable at the time because of changes in preservation and transportation technology. Trawling started in Britain in the late 1700s with fairly small nets and ships. Over time, fishers gradually increased the size of nets and they eventually started using larger boats called “smacks.” Smacks using beam trawls reached their maximum size in the middle of the 19th century, ranging between 23 and 36 tons (Holdsworth 1874, 66). Measuring up to 50 feet, the “beams” of a beam trawl held open the mouth of the net and so limited its size (Gibbs 1922, 46). (p.82) British fishers maintained their supremacy through most of the 19th century, but only by capitalizing on steam power.

3.1.2 Steam Power

In the late 1800s, transition from sail to steam power removed the technological limits that had prevented the overexploitation of high-priced species such as herring and cod and increased the profit disconnect for the most important commercially exploited species of the period. In combination with the otter trawl and other gear innovations, steam power allowed for substantial reductions in the cost per unit of effort for most species, negating the cost signal even as it increased the capacity to overexploit and overcapitalize fisheries. Because steam engines are more powerful than sails, these new vessels could move twice the maximum weight carried by even the largest sailing vessels, and most took advantage of steam-powered winches and other mechanical devices to supplement the manpower required to pull in large nets full of fish (J. T. Jenkins 1920; Holdsworth 1874). However, it took considerable time to develop fishing gears that were compatible with steam-powered locomotion. Net-based vessels were particularly affected, since they tended to tow their gear from the stern. Though not problematic for sail-powered vessels, towing gear from the stern was infeasible on steam-powered vessels because the propeller(s) would tangle in the nets.

Technological Adjustments

British fishers experimented with the first steam-powered trawlers in the 1850s, but they had no success until 1876, when they developed the otter trawl, which was much larger than the beam trawl and could be deployed from one side of the boat rather than the stern (Robinson 1996, 84). The otter trawl incorporated two “otter boards” on either side of the net rather than one beam across the mouth, so the size of the net was no longer dependent on the size of a beam (J. T. Jenkins 1920; Gibbs 1922). This innovation would not have been possible without steam power, which was necessary both to propel vessels large enough to handle the otter trawl and to power the mechanical winches that were needed to haul in the massive weight of the resultant catch. Because of this symbiosis, the scale of trawling operations increased substantially. In the 1920s, trawl nets were three times as large as they had been in the 1880s, and the otter trawls of the time could catch 47% more than a beam trawl (J. T. Jenkins 1920, 29; see figure 3.3 for a typical example). The new technology also proliferated rapidly. Steam-powered vessels rigged with otter trawls were in use in Spain, France, the United States, Germany, Belgium, the Netherlands, and other major fishing countries within a few years of their first successful (p.83) use by British fleets (Blake 1884; Teuteberg 2009). This increased capacity and reduced marginal costs of production for the most important commercial fleets of the time, speeding up the action cycle and widening the profit disconnect. As a result, coastal stocks were rapidly depleted, driving much of the exploration described in chapter 2.

A similar dynamic also occurred in the whaling industry. Whalers started experimenting with steam engines in the 1850s. Like trawl fishers, they were not successful at first. However, after a profitable run in 1861, steam-powered whaling vessels soon became a central part of the fishery (J. T. Jenkins 1921). Again symbiosis with whaling technology was critical for success. Specifically, since whale stocks were already overexploited in much of the North Atlantic, whalers had to travel far to find whale stocks and, in spite of high prices for whale products, the costs of coal to power steam engines for long journeys was prohibitively high until a Norwegian whaler invented the first harpoon gun. Much more effective than harpoons thrown by hand, early harpoon guns were about 4 feet long and had a range of 25–50 yards. They also sported a “bomb”—a glass vial of sulfuric acid that would break once the harpoon penetrated the whale, killing it quickly. These highly efficient weapons reduced the risks and the time involved in capturing large whales and could also be used to target smaller whales that

Investment and Innovation

Figure 3.3 A British steam trawler. Note that the boat still has rigging for sails, which were used in case of engine failure. Thus, the earliest steam trawlers were hybrids rather than purely steam-powered vessels.

Source: J. T. Jenkins 1920.

(p.84) were too quick and agile to catch easily using hand-thrown harpoons (256; see figure 3.4). The result was the “Norwegian” method of whaling, which used smaller steam-powered vessels that were much cheaper to fuel than the larger vessels used in the “American” method, which was only economically feasible with sail technology (Suisankyoku 1915). As described above, there was already a substantial profit disconnect in these fisheries, which was widened by the transition to steam; this step-wise change in technology increased whalers’ ability to maintain profitability in spite of declining whale populations and the overcapitalization of whaling fleets.

The purse seine was another type of gear that was made significantly more efficient by mechanization. US fishers pioneered the use of the giant or great purse seine for their mackerel fisheries in the 1870s. By using cotton instead of hemp, they increased the durability of their gear while reducing the weight. This innovation was beneficial to all net fisheries, since the same vessel could cover 5 times as much area with cotton nets than it could with hemp nets (Juda 1996, 18). American mackerel fishers also used steam-powered winches to pull full nets out of the water. In 1880, 468 US vessels employing 5,043 men used giant purse seines to harvest mackerel. With a total catch that year of approximately 59,874 tonnes, the catch per vessel was 127 tonnes and the catch per fisher was about 12 tonnes (Goode 1884,

Investment and Innovation

Figure 3.4 An early 20th century harpoon gun on a “Norwegian style” steam-powered whaling vessel.

Source: J. T. Jenkins 1921.

(p.85) 40). This was 15 times the average harvest per vessel (9 tonnes) or per fisher (1.21 tonnes) in the British mackerel fishery at the time, which was still sail-based and used both drift nets and traditional seines (Cornish 1884, 10–13). Lower costs of production associated with giant seines also revitalized the US fishery for menhaden in this period (Goode 1884). Menhaden provided cheap food for human consumption, but large amounts were also used as bait in line fisheries or as inputs into the manufacture of manure (38). In fact, these innovations helped the United States to pull ahead of Britain in the total amount of fish production. The US also had other advantages; stocks near its coasts were not as heavily overexploited as European fisheries and growing domestic markets for fish products generated high ex vessel prices for US fishers (Walpole 1884a; Goode 1884). Still, with increased production capacity, US fleets quickly overexploited coastal stocks, and yet again industrialization generated growing profit disconnects in many areas.

Mechanization quickly spread to other fisheries; reducing costs and increasing the open access level of production. For instance, mechanized purse seines were imported from the United States to Japan around 1880, for use in Japanese sardine and herring fisheries (Kitahara 1910). Development of mechanical gear also revitalized the demersal longline or trawl-line industry in the US and Europe, which faced tough competition from driftnets and trawl nets at the end of the 19th century. Lines that were once only a few hundred feet long were extended to 14 miles, with 12,000–15,000 hooks. In addition to mechanized hauling, US fishers developed machines that could bait hooks rapidly, feeding sections of lines from “baskets” in a fully automated process (Goode 1884, 11). This technology was also adapted in the pelagic longline fishery that was developed by the Japanese at the beginning of the 20th century. As noted above, longlines were used in many commercial fisheries targeting demersal species but had not been used to target pelagic species, which are mainly found in the water column rather than along the sea floor (Cobb 1906). The Japanese revolutionized this technology by using floats to suspend the longlines at a particular depth, rather than anchors that would keep the lines on the sea floor. This innovation allowed them to use longlines from three to ten miles in length to catch yellowtail, tuna, and other species that were not yet economically valuable in the West (Kalland 1995; Suisankyoku 1915).

Commercialization of Japanese fisheries started prior to their opening to the West in the middle of the 19th century, but Japanese vessels and fishing technologies remained relatively small in scale until the beginning of the 20th century, when the Japanese government started to encourage the (p.86) adoption of “European methods” (Howell 1995; Suisankyoku 1915; Okoshi 1884). This included purchase and then domestic production of the larger Western-style vessels, mainly using sails and steam. From 1902 to 1912, the Japanese industry added 124 steamers and 669 smacks to an extant fleet of more than 400,000 Japanese-style “junks” (Suisankyoku 1915, 10, 12–13). During the same period, the average size of vessels in the traditional Japanese fleet also increased, as the number of small boats (<18 feet) declined by 23% while the number of medium-size vessels (18–30 feet) increased by 56% and the number of large vessels (>30 feet) increased by 11% (5). The Japanese government also educated fishers to use new technologies and developed shipyards where larger “European-style” vessels could be built. Much as in other historically dominant fishing countries, these innovations completely altered the fishery, increasing the potential impact on fish stocks while reducing the marginal or per unit costs of production substantially. This shifted the equilibrium level of production out and widened the profit disconnect.

Industry Stratification

Fleets from many other countries adopted steam power at the turn of the 20th century (J. D. Campbell 1884; Yen 1910; Hurd and Castle 1913; J. T. Jenkins 1920). This further contributed to the stratification of the fishing industry and the widening of the profit disconnect. Large steam-driven fishing vessels were expensive and required far more capital than wooden smacks or schooners (J. T. Jenkins 1920; Teuteberg 2009). Data on fishing capital during this time are scarce, but information from the Scottish trawl fishery is indicative of the larger trend. While the number of fishing vessels decreased from the late 1800s to the early 1900s, the total tonnage of fishing capacity increased considerably. Furthermore, the value of the Scottish fleet rose from £1,712,349 in 1887 (more than US$140 billion in 2010 dollars) to £6,035,952 in 1913 (more than US$440 billion in 2010 dollars), even though the number of vessels declined by more than a third (J. T. Jenkins 1920, 13).2 Because operating a steam-powered vessel required substantial capital, many individual owners were replaced by corporations or limited partnerships during this period.

Sails and individual ownership remained common only in small-scale, near-shore fisheries that did not compete directly with steam power. Thus, the stratification of the fishing industry that began with capital-intensive whaling, cod, and herring operations increased in the era of the steam engine. Much as their ancestors had done, coastal fishers utilized small vessels, called “cutters,” that were well adapted to local conditions. A cutter cost (p.87) between £160–210 in the United Kingdom in 1914 (US$16,600–21,800 in 2010 dollars). Although this was a large sum at the time, it is small in comparison with the cost of building a steam trawler, which averaged around £6,000–7,000 before World War I (US$624,000–728,000 in 2010 dollars; J. T. Jenkins 1920, 20). The gear used by coastal fleets was relatively inexpensive as well, and often was produced locally or by the fishers themselves. In contrast, the cost of rigging a ship with a full set of otter trawls was about £600 (US$62,400 in 2010 dollars), three times the cost of a cutter (22).

This trend in capitalization continued after World War I. By 1920, a single deep-water steam trawler could cost about £9,800 (US$420,000 in 2010 dollars). Fully outfitting it with gear, provisions, and coal, ice, or salt for fish storage could cost as much as £9,000 per year (US$386,000 in 2010 dollars), much of which would have to be raised in advance of a long trip. The return on this investment was much larger catches—between 45 and 54 tonnes per vessel, and in one case exactly £10,704 (US$459,000 in 2010 dollars) worth of fish (J.T. Jenkins 1920, 21-22). These numbers are for British vessels, but the pattern was similar in other countries (Teuteberg 2009). Faced with heavy competition and declining profits, small-scale fishers lobbied for government protections during this period. They were unsuccessful politically (see chapter 6), but also took economic action, innovating to remain competitive against industrial fleets. By the early 1900s, many of the old sail-powered vessels were transitioned to internal-combustion engines in order to compete with their steam-powered rivals (Gibbs 1922; Sverrisson 2002). Small-scale fishers also adopted mechanical winches, much like those used by the big trawlers, to haul in nets or lines (J. T. Jenkins 1920; Suisankyoku 1915).

These technological improvements deepened the core problems of overexploitation and overcapitalization in many regions and added new layers to the stratification of fisheries around the world. In developed countries, those with ample capital could invest in distant-water fleets, while those with less could modernize their coastal operations. Elsewhere, fisheries remained at subsistence levels, with very low capital requirements. Many of these fisheries were sustainably managed for centuries through local institutions. However, this state of the world changed in the early 1900s, when capital and fishing technologies began to flow from historically dominant fishing countries into developing countries. The profit disconnect that started in the age of steam widened considerably. Costs declined for small, medium, and large scale fishers and the fishing industry spread throughout the world as petroleum power catalyzed further expansion of fishing effort.

(p.88) 3.1.3 Petroleum Power

World Wars I and II, as well as the Great Depression, dampened growth and innovation in fishing effort in the 1920s-1940s, but these effects were temporary. By 1948, global landings were slightly higher than they had been in 1938 and much higher than they had been before World War I (see figure 3.5). Furthermore, the world’s fishing capacity continued to increase well beyond pre-World War I levels as fishers increased both the size and the efficiency of their fleets (Holt 1978). Petroleum was pivotal in this period for three reasons. First, petroleum-fueled engines were smaller, cheaper, lighter, more powerful, and more convenient, allowing for reduced costs of production in fisheries and many other industries. Second, petroleum was used to make nylon nets and lines that were lighter, stronger, and more durable than cotton or hemp. Third, the boom in petroleum power fueled global trade and economic growth, allowing fishing companies to take advantage of terms of trade by moving operations to countries with the lowest costs of production. Combined, these innovations catalyzed the creation of modern factory-fishing vessels, which in turn allowed for the third wave of geographic expansion described in chapter 2 and substantially increased the profit disconnect in many fisheries globally.

The shift from steam to petroleum power began toward the end of World War I. Fishers primarily appropriated technologies that were already in use in other sectors, but some endogenous advances in gear technologies were also necessary. Large-scale (> 500 grt) oil-powered shipping vessels were in use at the turn of the century for non-fishing purposes and were common

Investment and Innovation

Figure 3.5 Total landings by European fleets, 1903–1949.

Source: ICES 2012.

(p.89) by 1925 (Juda 1996, 57). Japanese fishers started experimenting with diesel-powered fishing vessels in 1927, but the technology did not catch on until the late 1940s (Sverrisson 2002). A few fishers from other countries also experimented with oil-burning steam and diesel engines before World War II, but oil-powered motors were mainly used as auxiliary engines on sail-powered vessels or as primary engines on small vessels (<100 grt) until the postwar period. At that point, high prices and volatility of supply in the coal markets drove fishers with access to large amounts of capital to replace their old coal-fired steamers with either oil-fired steam engines or diesel engines. With government assistance, less wealthy fishers invested to replace their converted sailing vessels with gas-powered motor boats (Robinson 1996, 210–211; Royce 1987, 31; Chapman 1966, 11).

Coastal and Offshore Fleets

Evidence for the rise of petroleum power and the decline of steam can be found in figure 3.6, which shows the definite reduction in steam capacity for selected countries from 1930 to 1960. For these nine major fishing countries, the number of steam vessels reported fell from over 3,500 in 1930 to about 1,000 in 1955. The 1960 total is incomplete because data were not available for France, but the downward trend is clear for all countries and it is reasonable to believe that these trends were the same in other industrialized fishing countries (B. A. Parkes 1966, 29).3 Two developing countries, Morocco and South Africa, reported steam-powered vessels in 1960. This reflects a broader shift in fishing effort from historically dominant to developing fishing countries that started in the interwar period, largely as a result of increasing exploration by fishers from historically dominant fleets and escalation in the globalization of trade. China became the third-largest producer of fish in this period, and fleets also began to industrialize in India, Persia, Burma, and Korea, some with secondhand steamers and others with petroleum-powered vessels (US Congress 1947a).

Available data suggest that two major trends in investment expanded production in coastal areas after 1950. First, like capital-poor fishers from developed countries in the first half of the century, capital-poor fishers from developing countries augmented their sail-powered or oar-powered vessels with outboard or inboard motors to reduce their travel time and increased the distance they could go to find fish. For instance, in 1960, 97% of the powered vessels reported by Ghana were canoes modified with inboard or outboard motors (FAO 1962, table G-1). The People’s Republic of China also encouraged its fishers to switch from sail to petroleum power. From 1956 to 1963, the number of motorized vessels increased from 56 to (p.90)

Investment and Innovation

Figure 3.6 Count of steam-powered vessels reported by selected countries in five-year increments from 1930 to 1960.

Compiled from FAO Fisheries Statistics Yearbooks (FAO 1947, 1952, 1954, 1960a, 1962). No data were reported for France in 1945 or in 1960.

1,200 (Muscolino 2009, 182). Unfortunately, exact numbers are not available for most other countries, but data on average tonnage (where available) and notes in various reports suggest that many countries harbored growing fleets of powered canoes, sailboats, and other small craft in the early 1960s (FAO 1962, Appendix G).

At the same time, a few developing countries reported additional fleets of larger motorized vessels on par with the fleets of developed countries. It is difficult to say where the capital for such vessels originated, but it is most likely tied to exploration by fishers from historically dominant fleets. In some countries, like Ghana, expansion took the form of foreign direct investment. Seeking new fishing grounds, Japanese fishing companies started building up a fleet of motorized pole-and-line vessels in Tema, Ghana, in the late 1950s (Miyake, Miyabe, and Nakano 2004); they may have provided for the addition of motors to local vessels previously used for subsistence fishing as well. Japan also established fleets in its colonies (Korea, Taiwan, and Manchuria) before World War II and may have contributed to reconstruction of those countries’ fleets in the postwar period (Suisankyoku 1915; Muscolino 2009). US fishing companies also invested in fleets overseas, including in Macau, the Philippines, and other territories (p.91) captured during the war (Finley 2011). Capital flowed from colonial powers to new fleets in developing countries like Morocco and South Africa, which reported rapid increases in steam- and petroleum-powered vessels after World War II. Again, the need to expand away from overfished fishing grounds also led to the propagation of new, more efficient fishing technologies around the world.

Globalization further increased investments in innovation through economic development programs and through the expansion of international financial institutions. For instance, in South America several governments subsidized the development of domestic fleets in the 1950s and the 1960s. Their primary goal was to capture the benefits from fisheries resources in their newly claimed sovereign territory, usually the area within 200 miles of their coastlines (see chapters 5 and 6). Peru opened up the international fishery for Peruvian anchoveta, one of the largest and most valuable stocks in the world (Holt 1978). By 1960, the Peruvian fleet reportedly included more than 700 commercial fishing vessels, of which 268 exceeded 50 feet in length (over 100 tons gross) and 10 additional vessels longer than 100 feet (over 300 tons gross, on average). Brazil, Chile, Mexico, and Venezuela also pursued development through commercial fishing in this period (FAO 1962, table G-3). In addition, developed countries subsidized the rebuilding of their fleets after World War II, contributing to the expansion of existing size classes and to the building of new vessels capable of fishing in fardistant waters.

Distant-Water Fleets

As coastal fishers expanded in numbers and effectiveness through motorization and mechanization, distant-water fishers searched for ways to increase the amount of fish they could catch and preserve on long voyages. Before World War II, Japanese fishers started using a variation on the mother-ship configuration established by European schooners hundreds of years earlier. In the new Japanese system, however, the mother ship was a floating cannery that would process and store fish provided to it by fishing vessels that traveled with it. This system allowed the Japanese to fish for salmon off Alaska before the war and then to expand their fleets throughout the oceans once restrictions were lifted in the postwar period (Finley 2011). In fact, the 22 steamers that Japan retained in 1960 were probably cannery mother ships, given their average gross tonnage (4,744 tons (gross); FAO 1962, table G-4).

The United States also utilized the mother-ship approach, starting with a 390-foot converted steamer that was repurposed by the Alaska Southern Packing Company in 1939. This steamer was almost four times the size of a (p.92) typical high-seas fishing boat (100–150 feet long at this time; see figure 3.7). The floating cannery project was successful, and with the high demand for fish protein after the war, the US government backed the reconfiguration of several World War I era naval vessels by private companies, including the 423-foot SS Mormacrey, which was transformed into the Pacific Explorer in 1946. This reconfigured vessel fished for salmon in the North Pacific and for tuna in the tropical Pacific, specifically targeting areas that had been utilized by the Japanese before the war. With its attendant purse seine fleet, it could catch and carry 3,450 tonnes of fish in a single trip. Two other vessels with smaller carrying capacity (907 tonnes) were also fitted out at the same time (Finley 2011, 46–47).

Another innovative approach to reducing costs of production in distant-water fisheries was to build fishing vessels that could both catch and process huge amounts of fish. This method was developed in Britain in the 1950s to expand trade in frozen fish, which was an increasingly popular alternative to the canned product produced by Japanese and US mother-ship fleets. Christian Salvensen & Co. Ltd. commissioned and then launched the first factory trawler in 1954. It was a modern version of the older factory whalers and cod busses used by the Basques, Norwegians, and Dutch. Named the

Investment and Innovation

Figure 3.7 A US floating cannery with freezer storage, circa early 1900s.

Source: Cobb 1921.

(p.93) Fairtry, the first factory trawler was a 245-foot-long ship that displaced 2,800 tons of water.4 It could catch and process 27 tonnes of cod in a day and could hold up to 544 tonnes. Onboard processing included cleaning, filleting, and freezing the catch, creating a longer-lasting product compared to the existing method of preservation, which involved removing the heads of the fish and packing the bodies in ice. The Fairtry could also produce and store up to 45 tonnes of cod liver oil and 90 tonnes of fish meal. Fishing in the North Atlantic, this vessel was so successful that her owner soon commissioned two more factory ships, with quite a few adjustments to improve performance (Robinson 1996, 216). Before long, other countries ordered similar ships to plow through the cod, herring, and other valuable stocks in both the Atlantic and the Pacific (Gulland 1974). By the early 1960s, fishing vessels of 500–1,000 tons (gross) were common throughout Europe and vessels over 1,000 tons (gross) could be found in many countries (FAO 1962, table G-5).

Producing the Fairtry and other factory trawlers required significant amounts of capital and multiple technological innovations in the setup of the trawling gear. First, developing ways to haul in gear while moving was important for trawlers and required innovation that would allow deployments of nets from the rear of the vessel (Robinson 1996). Second, to fill the holds of these larger vessels quickly, fishers also had to engineer bigger gear. Though some design changes were necessary, like the double cod end for factory trawlers, the shift to monofilament nets and lines was also very important. This started with the development of nylon and other plastics for various military and civilian uses during World War II. Fishers appropriated these technologies, investing in ropes, lines, and nets made out of artificial fibers because they found that gear and rigging made from these materials was stronger and more durable than those made from cotton, hemp, or silk (Robinson 1996). Furthermore, monofilament nets and lines were more effective because they were harder for the fish to see and avoid. This was particularly important in gillnet and driftnet fisheries, but also benefited purse seine fleets. Thus, even small-scale fishers benefited from the introduction of plastics to the industry (Royce 1987).

With the use of monofilament technology and the related modifications to vessel size, stability, and machinery, the maximum size and efficiency of other types of net-based and line-based gear increased substantially. For instance, in the 1870s longlines could be as much as eight miles long, with hundreds of hooks (Holdsworth 1874, 137). Almost a century later, with the use of monofilament technology, they could be more than 60 miles long, with 3,000–4,000 hooks (Ward and Hindmarsh 2007, 502). The impact on trawling was just as impressive. In the 1870s, when sail was still the primary (p.94) method and gear was mostly hemp or cotton, the maximum size of a trawl haul was about one tonne (Holdsworth 1874, 80). A steamer of the early 1900s using an otter trawl net could catch about four times as much as a sailing smack (Robinson 1996, 112). The Fairtry could catch about 27 tonnes a day in the 1950s, which made it about eight times as effective as a steamer and 30 times as effective as a smack (216). Today’s double trawlers, which have nets on each side of the vessel, can catch as much as 90 tonnes per day when fish are abundant (Royce 1987, 31).

Access to Capital

Of course, factory vessels with appropriate gear technologies are more expensive than their predecessors and so are only available to those with considerable access to capital. For instance, it cost US$5 million to retrofit the Pacific Explorer in 1946 (Finley 2011, 63). That would be more than US$43.6 million in 2010 dollars (Williamson 2014). Less than ten years later, construction of the Fairtry cost £1,000,000—more than US$31.1 million in 2010 dollars (Warner 1997; Officer 2013). Similar vessels commissioned by the Soviet Union would have cost about US$3.2 million each to produce in the United States at the time—a total of US$21.6 million in 2010 dollars (CIA 1959; Williamson 2014). In free market economies, such vessels could be purchased only by large companies with substantial capital. In most cases, governments subsidized the purchase of these megafleets and at times also provided assistance to cover operating costs. In centrally planned economies, governments purchased large numbers of these vessels, crowding out private investment (Armstrong 2009; see chapter 6).

Expansion of factory fleets was also facilitated by secondary economic actors. Fish processors, desiring a steady flow of product, often chose to purchase their own vessels rather than rely on independent fishers (Hamilton et al. 2011). Some processors also provided loans to fishers to allow them to buy their own vessels and gear, or to cover operating costs. Many examples of such behavior occurred throughout history, and merchants or wholesalers, including the Hanseatic League and the Dutch Herring Councils, frequently used the same practice to guarantee access to supplies of fish. Other examples were observed in the 18th and 19th century in China, Japan, and India, though technologies supported by fish brokers and merchants at the time were not mechanized (Muscolino 2009; Kalland 1990; Day 1873). In the 20th century, many large US fleets, including the tuna and sardine fleets of California and salmon fleets of Alaska, were purchased with capital raised by canneries (Cobb 1906; US Congress 1947b). Some fishing corporations, like Christian Salvensen & Co., expanded their operations from fishing to processing, but generally canneries and merchants accumulated (p.95) capital that they would then use to purchase their own vessels or to provide loans to fishers.

Although capital requirements limit entry into large-scale fisheries, over time resale markets provide wider access to not-quite-new technology. The vessel prices noted above are at initial sale. When new vessels are built, old vessels are often sold rather than scrapped. The lower prices for used fishing vessels enable fishers who lack access to sufficient capital to purchase the latest equipment to purchase more up-to-date vessels and gear. This is particularly important in developing countries, where capital tends to be limited. For example, in 1969, the Fairtry was transferred from the original owner to the K M Corporation, and the vessel was reflagged in Panama as the Joy 2. It was not decommissioned until 1985 (Aberdeen City Council 2013). The resale price is not recorded, but current resale prices for similar vessels range from US$7.5 million (for a vessel built in 1984) to US$16 million (for a vessel built in 1994), both much lower than the inflation-adjusted price of the Fairtry (Atlantic Shipping 2013). However, prices in resale markets vary considerably in time and space, depending on the condition of the targeted fisheries. Any new discovery that leads to higher profits in a fishery also generates increased demand and higher prices for new and used vessels.

All in all, the process of investment for innovation in vessel and gear technologies sped up the action cycle for fisheries around the world, widened the profit disconnect in most areas, and exacerbated the problems of overexploitation, overcapitalization, and ecosystem disruption. Because of high capital requirements, new technologies also led to the stratification of the fishing industry, with fishers in different niches using different types of technology to reduce costs of production in spite of declining stocks and intensifying competition.

3.2 Fish-Finding Devices

In addition to developing faster vessels, mechanized gear, and factory fishing operations, fishers also increased their efficiency by developing better methods for finding fish. This increases the profit disconnect and facilitates expansion of fisheries in two ways. First, better fish-finding technologies make it easier to find fish in spite of declining stock sizes, thereby dampening the cost signal. Second, these same technologies allow fishers to expand the depth and breadth of their searches, helping them to find and exploit new fisheries. In fact, most distant-water fisheries would not be feasible without the advanced fish-finding technologies described next. The history (p.96) of technological advances in fish-finding devices is somewhat independent of innovation in vessel and gear combinations, so it would be difficult to present an integrated historiography. That said, the general pattern of escalating innovation through cycles of growth does hold for this type of technology. This section covers patterns of innovation in fish-finding technologies with discussion of implications for costs of production, capital requirements, and stratification of the fishing industry.

One of the most important traditional ways to find fish that are dispersed through large areas, or that cannot be seen from the surface, is to use information about their habits and habitats to predict their locations. From the earliest days, fishers recognized the need to record and analyze such data. Seasonal movements, temperature ranges, and food preferences all can help fishers to find the best locations for harvesting a specific species at a given time. Such information was coded into the traditional ecological knowledge that shaped many ancient fisheries (Shackeroff, Campbell, and Crowder 2011; Cash et al. 2003; Lauer and Aswani 2010; Sethi et al. 2011; Berkes and Folke 2002; Berkes 1999). As fishers became wealthier, many gained literacy and began using charts and logbooks to keep track of patterns in ocean conditions and fish abundance for specific areas and species. Beginning in the 1800s, marine science added significantly to the store of knowledge about the relationships between fishes and their habitats. Though governments and academic institutions fund many marine research programs, fishers themselves often invest in science that will help them to find new fishing grounds or to follow fish when they are hard to find.

Correlations between visible surface disturbances and the less obvious underwater presence of fish have also been extensively used to find fish or other species that congregate near the surface. For example, whales, dolphins, and some species of fish are highly visible because of their breaching behavior. Whalers looked for this and the telltale spouts of their prey for many centuries (J. T. Jenkins 1921). When close to the surface, schools of fish disturb the pattern of waves, often creating a “flat spot” or a “boiling spot,” depending on the level of activity underwater. Boiling spots usually occur when a school is being attacked by predators, which drive it to the surface, sometimes forcing their prey to leap out of the water. Seabirds provide an even more obvious indication that fish are present. They will often converge on a school in large, visible, and raucous groups. Fishers have followed conglomerations of seabirds to rich fishing grounds for much of history. Other associations are more mysterious. For instance, in the eastern Pacific dolphins associate with schools of yellowfin tuna. The dolphins are (p.97) not feeding on the tuna, or vice versa, but the two species commonly travel together, and thus fishers can find tuna more easily because they can spot the dolphins (Felando and Medina 2011).

Using lures is another traditional method of finding fish. Bait, the most common lure, is mostly used in line fisheries. As noted above, baitboats chum the water, attracting fish to their boats. Longlines of various types use baited hooks. Most bait is “trash fish”—fish that is low in price or can’t be sold. However, fishers are careful to choose bait known to be preferred by the species they are targeting. Fishers also sometimes use lights to attract nocturnally active species, such as squid and mackerel. Torches were used originally, but eventually were replaced by powerful electric bulbs and glow in the dark sticks (Suisankyoku 1915; Okoshi 1884; FAO 2012d). Association with floating objects is also important in some fisheries. Although the reason for this association is still uncertain, artisanal fishers noticed the relationship and began building artificial floating objects as early as the 17th century. In the 1990s, tuna fishers in the eastern Pacific began using manmade fish-aggregating devices (FADs) on an industrial scale because of political controversy over the killing of dolphins in the fishery. The method was extremely successful both in increasing catch and in reducing the costs of production. It is now used in other regions as well (Bromhead et al. 2003).

Fishers who target species that are easily spotted at the surface (surface fisheries) have found many ways to increase their search range. The spyglass of old gave way to high-powered, deck-mounted binoculars that were originally developed for military use. Many vessels now use spotter planes and helicopters to improve visual location (pioneered by Harold Medina in the 1950s), and use satellite and radio technologies for geo-positioning so that a skipper can quickly get to a school of fish once it has been found (Felando and Medina 2011). Some commercial seiners that travel too far out to sea to rely on land-based helicopter services now carry a helicopter on board. Even though the capital costs are high, a helicopter increases efficiency so much that smaller seiners either pool their resources to purchase a shared helicopter or rent helicopter time. At a lower price point, GPS is commonly used in commercial fleets, and skippers use both radio- and cell phone-based communication to keep in touch with each other. Encryption is now important to prevent valuable information about the location of a school from being appropriated by a rival.

Other technologies are used by fishers targeting species that are not as easily spotted at the surface (groundfish and deep-water fisheries). Sounding, an old method for determining the depth and other characteristics of the bottom, was used by fishers targeting groundfish (bottom dwellers; (p.98) Gibbs 1922). When fish like cod were very abundant, fishers could also detect schools by sensing vibrations caused by the fish hitting the weights on their longlines (Huxley 1884). Using technologies developed during World War I, British fishers began experimenting with echolocation systems in the 1930s. Twenty-five years later, after considerable refinement of the technology by the US military during World War II, both sonar and radar were in widespread use and had become essential to fishers around the world (Finley 2011). Early sonar systems required a lot of skill to interpret, but today computer microprocessors are able to analyze the information from echo devices quickly and precisely.

Fishing vessels of all size classes now have radar and sonar capabilities that differentiate the sizes of individual fish within the search radius. These “fish finders” are widely available around the world at a variety of prices. Cheaper versions can be purchased for a few hundred US dollars and provide information for depths of 500–1,000 feet. For higher prices (US$3,000–$18,000), commercial fishers can purchase systems that will map the size and location of fish at depths of more than 9,000 feet (sonar) or identify schools and large agglomerations more than 100 miles from the ship (radar; see, e.g., Furuno 2013; Hondex 2013; NFUSO 2013; Simrad 2013). Until recently, there was a substantial tradeoff between range and resolution in sonar, but new “chirp” technology allows for high resolution even at great depth and distance (see, e.g., Raymarine 2013).

Some fishers also utilize GPS devices to track their gear, and many use satellite imagery to locate likely fishing spots. For instance, free-floating gear like FADs were first tracked via radio signals, which could be monitored by everyone, but now FADs are located using encoded GPS signaling systems. Fishers also attach sonar arrays to FADs so they can assess the size and composition of associated schools from a distance. Satellite imagery of cloud cover was first provided to fishers by governments to improve safety by increasing available information on weather conditions. Now, satellite imagery of important environmental conditions such as sea surface temperature and chlorophyll concentration are freely available through several national or joint private-national institutions, including NASA and JPL in the US, JFIC in Japan, and CSIRO in Australia (NASA 2013a; NASA 2013b; JFISC 1999; CSIRO 2013). Although some fishers are very good at analyzing this information themselves, there are also private services that supply fishers with analytical software that compiles and interprets satellite imagery for specific fisheries (see, e.g., SeaView Fishing 2013; DigitalGlobe 2013; Ocean Imaging 2013; SeaStar 2013; SpaceFish 2013; Catsat 2013).

(p.99) In combination with the vessel and gear innovations described in section 3.1, these new fish-finding technologies catalyzed an enormous increase in the effectiveness of fishing effort, widening the profit disconnect substantially. Measures of the exact effects on costs are not available, but Royce (1987, 33) estimated that the biggest and best fishing fleets of the 1980s were 1,000 times more effective than subsistence fishers using manually operated boats and gear and 100 times as effective as modern small-scale coastal fishers. Even the less advanced versions of distant-water fishing trawlers, seines, and longlines were 100–300 times as effective as subsistence fishing methods. Given that many new devices have been introduced since the 1980s, it is safe to say that fishing efficiency and effectiveness continue to improve even though marine capture production stagnated in the 1990s. I will return to this issue after a brief discussion of aquaculture as a potential innovation in fish production.

3.3 Aquaculture

Aquaculture is one of the most important sources of increased fish production in recent years. Harvests in capture fisheries leveled off in the 1990s, and the growth in fish production since that time is largely due to aquaculture. Most aquaculture operations are based in freshwater systems (60%) rather than in marine systems (40%), and growth is higher in freshwater production as well (FAO 2012d). Furthermore, fishing and aquaculture require two very different skill sets, and aquaculture techniques evolved separately from fishing technologies (see chapter 6). Therefore, it is difficult to consider aquaculture as an endogenous response in the fisheries action cycle. Instead, I treat it as an exogenous factor that can have substantial if unpredictable impacts on the price signal. This section briefly covers the development of aquaculture and related implications for capture fisheries.

Freshwater aquaculture dates back at least as far as 5000 BCE (Yen 1910, 370). There are also prehistoric examples of lagoon-based aquaculture systems in which community management distributed endowments and entitlements similar to those adopted for capture fisheries (Huxley 1884, 7). In the 19th century, entrepreneurs and scientists began working on hatchery and seeding programs, often with government support (see section 6.2). Seeding involves raising fry in a lab setting and then introducing them into the wild environment. This has been done successfully with white sea bass off the California coast and with salmon in various parts of the Pacific, but is not economically feasible for large stocks of marine species (Hervas et al. 2010). Mariculture has been much more successful than seeding alone. (p.100) Definitions for mariculture are diverse, but it generally includes any form of human intervention designed to increase the productivity of a marine population. Two common forms of mariculture are salmon farming and bluefin tuna ranching. Farming involves raising fish from hatcheries; ranching entails the fattening of wild-caught fish. Both ranching and farming can increase the biomass harvested, but ranching may reduce overall fecundity, exacerbating stock decline (Volpe 2005).

These mariculture techniques are controversial for several other reasons. First, economically viable species tend to be large, carnivorous fish that require substantial protein input, usually from capture of smaller marine species that would provide more human nutritional value if consumed directly. Second, concerns exist about concentrations of effluent waste around mariculture operations, which result in depletion of oxygen and general habitat degradation. Third, because of the close proximity of fish in pens, antibiotics are commonly used to reduce disease mortality. This creates several problems, including introduction of antibiotics into the marine environment and the proliferation of antibiotic-resistant diseases in wild stocks. Fourth, parasites also breed much more successfully in pen environments and can easily transfer to wild stocks. This is particularly problematic for fry and small fish, which can easily succumb to just one or two parasites. Fifth, where saltwater aquaculture is carried out on land, as with shrimp farming, considerable destruction of coastal ecosystems like mangrove forests can result, which, in turn, leads to degradation of coral reefs and related marine ecosystems. Finally, recent attempts to introduce transgenic fish into mariculture operations raise the fear that these genetically modified fish could escape and completely alter wild populations through competition or interbreeding. To cope with these problems, entrepreneurs started developing an approach called integrated multi-trophic aquaculture (IMTA). There is also increasing interest in cultivation of tilapia and other vegetarian species to reduce pressures on wild populations (see Naylor and Burke 2005 and Troell et al. 2003 for a good overview of these issues).

In terms of the AC/SC cycle, both mariculture and aquaculture increase the global supply of fish products, but impacts on price signals are not always predictable. In some cases, growth in aquaculture production increases the supply of substitutes and thereby drives down prices for targeted species. An example would be the decline in the demand for swordfish in the United States in the 1990s, which was at least partly caused by the greater availability of cheap farmed salmon (Webster 2009). Interestingly, salmon culture did not drive down prices for wild-caught salmon. Instead, separate markets developed for farmed and wild-caught fish, with (p.101) a significant price premium for the latter (Schlag and Ystgaard 2013). Similarly, ranched bluefin tuna does not draw the same high prices as wild bluefin, even though all bluefin in the market are wild-caught (Webster 2009). These effects depend heavily on consumer perceptions of product quality as well as attitudes related to social status and environmental conservation. Indeed, as the next chapter shows, the shaping of these attributes through marketing is a critical determinant of demand for both farmed and wild-caught fish. In any case, as currently practiced, aquaculture magnifies core problems in some fisheries and also creates environmental issues of its own, so it is not yet a viable solution in the fisheries action cycle.

Looking toward the future, it is difficult to predict what new innovations may occur in global fisheries. It is possible that gradual technological improvements will continue, with prolonged impacts as new technologies percolate through the many strata of the global fishing fleet. Transformative innovations are more difficult to anticipate. It appears that economies of scale are exhausted, particularly given the state of global stocks (World Bank and FAO 2009). Fish finders are already highly sophisticated, but searching for fish still involves substantial uncertainty, particularly in open-ocean fisheries. Ironically, the next great innovation in fishing technology will probably be driven by larger environmental concerns, such as climate change and the depletion of fossil fuels. Much as petroleum-powered engines replaced steam engines when the cost of coal increased, renewable energy sources may replace fossil fuels as prices rise and people express growing concern about the effects of greenhouse gases.

Fuel price increases are the most likely driver of the development of substitute propulsion technologies. Unlike the temporary price hikes associated with the OPEC oil cartel in the 1970s, and in spite of recent steep declines, real price increases that started in the early 2000s can be expected to continue for the long term (EIA 2013). In addition, carbon taxes and other regulations designed to reduce greenhouse gas emissions have increased the cost of fuel in some countries and may spread further as the world seeks to cope with climate change (EIA 2012). High fuel costs reduce the profit disconnect temporarily, but fishers are already investing in improving the fuel efficiency of their operations (World Bank and FAO 2009; M. E. Riddle 2003). Innovations include better fish-finding technology to reduce search and travel time, more efficient engines, and changes in vessel operation to increase fuel economy. I have also spoken with several fisher-entrepreneurs who are looking for ways to harness renewable energy to replace their diesel-powered engines. If this occurs, it would be yet another transformative (p.102) innovation in global fisheries, and could lead to even greater increases in fishing capacity, fish catches, and, ultimately, the overexploitation of fisheries resources. Indeed, given that fuel accounts for about 50% of the operating costs for commercial vessels and that new vessels are counted as assets rather than liabilities, the effect of this innovation on the action cycle and the profit disconnect could be quite profound.

Aside from renewable energy, not many other transformative innovations can be expected to occur in fisheries in the near future. Indeed, there have only been a few major changes in fishing technologies since the 1970s, and those were in fish-finding devices rather than in vessel-gear combinations. Nevertheless, even gradual innovation can dampen the costs of production, widening the profit disconnect and worsening the core problems of the action cycle. Exploration is approaching global limits. Innovation is leveling off. The next chapter tackles market expansion.

Notes:

(1.) It is not feasible to reliably convert these values into modern currency; however, this was a period of Dutch ascendency, and florins were a major currency of international exchange, much as the dollar or the pound is today.

(2.) This was a period of very low inflation in Britain, so most of the difference is due to increased capital investment (Twigger 1999).

(3.) Data are compiled from the Statistical Yearbooks of the UN Food and Agriculture Organization (FAO), which began collecting information on fisheries from as many countries as possible after World War II. Because methods differed from report to report and from country to country, these early data must be examined carefully, but the broad trend depicted here is not a result of changes in reporting.