Application of a Dynamic Stochastic Adaptive Bioeconomic Model to Evaluate the Economics of Offshore Bluefin Tuna Aquaculture in the United States

Over the past fifteen years, the market for bluefin tuna has evolved in an attempt to further enhance the economic value of each bluefin tuna caught. Pioneered by the Japanese and Australians, offshore bluefin tuna farming is currently practiced in Japan, Australia, and Mexico and in Mediterranean countries including Croatia, Spain, Malta, and Turkey. Historically, the United States, and in particular the East Coast of the US, has been a major supplier of high quality bluefin tuna to Japan, the primary market for high quality bluefin tuna. To date, many questions regarding the economic feasibility of offshore bluefin tuna farming in the United States remain unanswered. This research will assess the economics of an offshore bluefin tuna aquaculture industry located on the East Coast of the United States by developing a dynamic stochastic adaptive bioeconomic model of an offshore bluefin tuna aquaculture operation. In explicitly modeling the stochastic nature of production, this model will incorporate the biological, technical, economic, and regulatory sources of risk associated with the offshore production of bluefin tuna. This will allow for a more realistic treatment of both the risks inherent in offshore bluefin tuna aquaculture production as well as a more realistic treatment of the firm response to stochastic changes in the production process and/or operating environment over time.