100


trend variables are measuring a variety of factors which have resulted

in a steady increase in nominal dockside price.

 The aggregate effect of these factors on price is very similar in

all of the states composing the reef fishery. Florida price of reef

fish has the largest estimated average annual price increase. Over the

sample period, price in Florida has increased at an average rate of 1.8

cents per year. Louisiana price has the lowest estimated rate of

increase, averaging only about 1.0 cent per year.

 Overall, the estimated system of price equation for the Gulf of

Mexico Reef Fish Fishery have confirmed all a priori expectations from a

statistical and economic standpoint. Statistically, the significant

improvement in the signs of the estimated coefficients and the decrease

in standard errors obtained by utilizing the two stage Aitken's esti-

mator serve to support the expectation that significant contemporaneous

correlation across states would be present. Furthermore, the estimated

within and across state price flexibilities confirm the a priori notion

of Florida's dominance in the fishery with regards to price determination.


 Gulf of Mexico Reef Fish
 Optimization Model

 The concept of maximum economic yield (MEY) in the context of

fishery production is synonymous with profit maximization. The esti-

mated state catch and price equations presented above and additional

cost information constitute the basic empirical components necessary to

derive a MEY management strategy for the GMRFF. The derivation of MEY

catch and effort levels requires the simultaneous maximization of each

state's profit function since the fishery is a multi-sector fishery and