benefits -- here defined as gross economic
benefits derived from use of a resource. Not to be confused with
net benefits where opportunity costs are subtracted from gross benefits.
bioeconomic modeling -- mathematical
formulae that simulate the interaction between biological behavior
of fish stocks and human behavior of users of the resource as it is
shaped by economic factors.
cash flow analysis -- a type of financial
analysis that compares the timing and amount of cash inflows with the
timing and amount of cash outflows. A firm’s cash flow position
can greatly affect its ability to remain in business. These effects
may not be apparent from a cost-benefit analysis.
charter boat -- any vessel-for-hire engaged
in recreational fishing and hired for a charter fee by an individual
or a group of individuals (for the exclusive use of that individual
or group of individuals), which results in that vessel being unavailable
for hire to any other individual or group of individuals during the
period of the charter.
consumer surplus -- net economic
value from consumption or use of a good or service. It is the
difference between the maximum that a person is willing to pay for
the good or service rather than do without it, and what he/she actually
spends. The adjective, “consumer” is misleading because this
category of value also applies to non-consumptive uses (e.g.,
observing salmon runs) and to non-use benefits (e.g., protecting
marine mammals from exploitation).
contingent valuation -- a method which
uses survey questions to elicit people’s preferences for public goods
by asking what they would be willing to pay or receive for specified
increments or decrements in the public good.
cost-benefit analysis -- a comparison
of the economic value of using a productive resource with the opportunity
cost of using the resource. Projects or regulations are evaluated
based on how they change net economic value.
demand function -- a behavioral relationship
between quantity consumed and a person’s maximum willingness to pay
for incremental increases in quantity. It is usually an inverse
relationship where at higher (lower) prices, less (more) quantity is
consumed. Other factors which influence willingness-to-pay are
income, tastes and preferences, and price of substitutes.
economic efficiency -- a measure of the
size of consumer surplus and producer surplus. An increase in
the combined surpluses is an increase in economic efficiency.
ecotourists -- individuals who rent services
of non-consumptive providers or produce non-consumptive trips themselves.
existence value -- value that individuals
place on the existence of living ocean resources.
financial analysis -- cost accounting
based on market prices as opposed to opportunity costs.
financial ratio -- a method of evaluating
a firm’s financial position. An example is the “current ratio” which
is equal to current assets divided by current liabilities.
fixed costs -- costs that do not vary with
the level of output.
input-output analysis -- a systematic method
that both describes the financial linkages and network of input supplies
and production which connect industries in a regional economy (however
defined), and predicts the changes in regional output, income, and
employment. Input-output analysis generally focuses on economic
activity and the self-sufficiency of an economy, unlike cost-benefit
analysis which focuses on changes in net national benefits from use
of a productive resource.
maximum willingness to pay -- maximum
valuation placed by an individual on a good or service in terms of
money. The summation of individuals’ maximum willingness to pay
is tantamount to the total economic value of consumer benefits (i.e.,
gross benefits).
net economic value (alternate term for
net national benefits) -- sum of consumer surplus and producer surplus.
net national benefits (alternate term
for net economic value) -- sum of consumer surplus and producer surplus.
non-consumptive users -- individuals
may use (i.e., observe), yet not consume, certain living ocean
resources, like whale watching, sightseeing, or scuba diving. Additionally,
individuals might value the mere existence of living ocean resources
without actually observing them. In this document, uses of this
kind are defined as non-consumptive. Some argue that certain
non-consumptive uses disrupt habitats, breeding patterns, or feeding
patterns and should therefore not be considered non-consumptive. Our
use of the term is for classification purposes only and not for descriptive
purposes.
non-users -- individuals who obtain value
from a resource, but do not use the resource.
opportunity cost -- generally intended
to refer to foregone economic value when a productive resource, such
as labor, capital, land, or fish, is used to produce one good or service
instead of something else.
party boat (also called a head boat) --
any vessel-for-hire engaged in recreational fishing and hired (or leased,
in whole or part) for a per-capita fee on a first-come, first-served
basis.
producer surplus -- the total revenue
obtained from using a productive resource minus all opportunity costs
of production (opportunity costs of entrepreneurs’ skills, labor, capital,
and ownership of natural resources).
supply function -- shows the quantities
of goods and services a producer would provide at various prices.
trade analysis -- economic analysis of
the trade of goods and services between countries.
value added -- the dollar value of a firm’s
output (i.e., harvest) minus the dollar value of the inputs
it purchases from other firms.
variable costs -- cost that vary with
the level of output.