Methodological issues in estimating the profit of the core catch business unit of a fishing vessel firm

Abstract

In fisheries, only the strategic business unit (SBU) of a firm that exploits a common-property natural resource can yield a resource rent. Hence, we discuss issues in isolating the economic return of the catch business unit (CBU) of a fishing vessel firm based on public accounting data. Furthermore, if detailed data on the CBU are available, some of its profit may stem from financing activities. Accordingly, we discuss issues in separating the economic return of the financing and operative activities of the CBU.<ul>

<li>Frequently, the industry is the unit of analysis in profitability surveys of fisheries. The data applied do not always clearly separate the profit of the CBU from other strategic downstream business activities in the value chain such as processing, sales, and non-fishery activities. Further, the economic return is always corrected for financial items. In addition, profitability may not properly reflect the return from the operational activities of the CBU.</li>

<li>In the method described in this paper, the unit of analysis is the individual CBU and not the industry. Moreover, the accounting figures from the firm level have been corrected to disclose only the economic return of the operational part (core) of the CBU.</li> </ul>