Sustainable fishery policy for Thailand Gulf: a general equilibrium analysis

Study of fisheries policy has conventionally been limited to partial equilibrium analysis where capture fisheries are considered in an isolated world without connection with the rest of the economy and without endogenous change in prices. This causes a two-way problem in policy analysis in that firstly consequences of fisheries policy cannot spread out of the sector and thus incorporate feedback from the rest of the economy, and secondly any economic policy also cannot affect the fisheries sector. As a result, any policy analysis regarding the fisheries sector cannot be accurate or even correct. This research builds a computable general equilibrium model for Thai fisheries to study full consequences of fisheries or economic policies in Thailand. The model specifies the economic activities of not only capture fisheries but also aquaculture, fish processing and fish marketing sectors as well as the rest of the economy, and captures their interactions. The empirical applications of the model with market-based policy instruments such as fishing taxes and subsidies reveal that fisheries or economic policies aiming to protect the resources or restructure the sector, if properly designed and combined, can achieve their goal as well as avoid potential losses.