reef fishery.8 Vessel size, however, does have a significant impact on

the annual cost of operating and maintaining a vessel. A priori, it is

expected that larger vessels should have both higher fixed and variable

costs than their smaller counterparts which indicates that costs are a

function of vessel size. Within the context of the present model,

vessel size is predetermined by way of fixing the average fishing power

of vessels and, hence, cost per vessel is also constant. Any change in

vessel size would necessitate an adjustment in cost.

 Several data adjustments were required to derive annual cost esti-

mates for reef fish vessels. Cost data by vessel size were obtained

from survey data on Gulf of Mexico grouper-red snapper vessels (Cato and

Prochaska, 1976b). Cost items included in calculating the annual cost

of operating and maintaining a reef fish vessel were fuel and oil,

repairs and maintenance, depreciation, license, interest, insurance and

miscellaneous costs. Cost items directly associated with crew shares

were excluded. All cost items were reported in nominal terms for 1974

and 1975. These cost figures were then inflated to 1979 levels using

wholesale price indices for specific items (Bureau of Labor Statistics,

1979).

 Vessel sizes were reported in the survey data in terms of vessel

length. Vessel sizes in the estimated catch equations, however, were


 8An alternative manner of dealing with crew shares in relation to
cost would be to consider the average annual income per crewman as a
direct cost to the captain or owner. In that this income is a function
of total catch and, hence, revenue, the total revenue function would
have to be adjusted to account for this. Such an adjustment would be
extremely difficult to accomplish with any degree of accuracy. Thus,
the term profit in the present refers to the returns above cost attrib-
utable to the psuedo captain crewmen partnership.