[Online] Gabriel Englander, World Bank

Paper: “The value of information in a congested fishery”

Abstract: We model a fishery with potential congestion; fishers obtain both public and private signals about the location where the fish stock is densest. We extend existing theory by including a larger parameter region, correlation between public and private signals, and two types of information sharing. We analytically determine the regions of parameter space where greater precision of public and/or private information increases welfare. Using high-resolution data from Peru’s anchoveta fishery, we estimate a structural model. Point estimates imply that more precise public information lowers industry profits, and more precise private information raises profits. This difference reflects the fact that public information increases congestion to a much greater extent, compared to private information. Making public only a small fraction of private information lowers welfare, but more extensive information sharing raises welfare. Welfare is much more sensitive to changes in the precision of private information than to changes in the precision of public information.