English abstract
In the context of small-scale fisheries, the interrelated issues of Capacity Utilization (CU) and Technical Efficiency (TE) have received global importance as they relate to the problem of overcapitalization and overfishing. Given the strategic importance of fisheries in Oman and limited research on these issues, the main objective of this study is to evaluate economic performance of the sector using regional fishery as a case study. More specifically, the study empirically examined the status of small-scale fisheries CU and TE of harvest and post-harvest operations.
To meet the objectives of the study Data Envelopment Analysis (DEA) was applied to analyse CU in the harvest sector, technical efficiency (TE) in both the harvest and post harvest sectors, and carried out cross-efficiency evaluation through risk minimization to identify top performing fishers. Furthermore, a questionnaire survey was conducted to collect relevant primary data used for the analysis of CU and TE involving both harvest and post-harvest sectors. Tobit regression techniques were used at the second-stage of DEA analysis to identify significant factors (that were not considered in the first-stage analysis) affecting CU and TE in the harvest sector and TE in the case of the post-harvest sector. In addition, descriptive and non-parametric statistics were used to analyse primary and secondary data. The study covered the period 2010-2012. The aggregated and/or average catch of three fish species categories namely large pelagic, demersal, and other species per fishing trip were used as output variables, while boat length, engine power, number of crews and fishing period were used as inputs in the first stage DEA under the assumption of both constant and variable returns to scales. The unbiased CU estimates reveal that, on average, the degree of CU of the sample boats is high however they may not be using variable inputs efficiently. It is, therefore, envisaged that, on average, there is potential for enhancing production without having to incur any additional costs with regard to acquisition of new physical capital and equipment. Furthermore, capacity output estimates provide a signal to the extent of excess capacity. The results also indicated that a large proportion of representative boats were operating in a technically inefficient manner and TE declines in majority of cases over the study period. A Similar downward trend is also noted in the distribution of scale efficiency estimate over the years and majority of boats was operating in the increasing returns to scale region. The results of the second-stage DEA showed that fishing location, Catch Per Unit of Effort (CPUE), fuel costs and crew share were statistically significant at the 5% level under Constant Returns to Scale (CRS), while subsidy and other operation costs were significant under Variable Returns to Scale (VRS) in the case of CU. With regard to TE, the combined model results under both CRS and VRS assumptions showed that 6 variables were statistically significant at the 5% level. Out of those 6 variables, the results of 4 variables, namely, age, education, subsidy and CPUE were common in both models. With regard to peer-assessment and risk minimization, a list of ten top performing fishers was presented.
In relation to post-harvest sector, the descriptive results indicated the highest variability in distribution time of fish products. The empirical results based on DEA analysis indicated that only 13% of DMUs were efficient under CRS and 18.2% under VRS assumption, respectively. Majority of fishers (more than 80%) were technically inefficient in dealing with their first-hand sale. More importantly, on average, about 72% of DMUS were not operating at the optimum scale of operation. The second-stage DEA analysis based on Tobit regression techniques suggested that age and education have negative association with TE while DMUs' relationship with buyers and their accessibility to central market exert positive influence on TE. These findings warrant appropriate attention from the management authority to improve operational efficiency of and better economic returns from the post-harvest sector. Based on these results, it is envisaged that there is potential for enhancing production and distribution without having to incur any additional costs with regard to new physical capital and equipment. Furthermore, capacity output estimates provide a signal to the extent of excess capacity. Regardless of the stage of development in the fisheries sector in Oman, the issue of efficiency deserve careful attention as a requirement to achieve its objectives stipulated in the strategic plan. Finally, policy implications of these findings are discussed. To gain a better understanding of harvesting operations in the small-scale fisheries sector in the country, it is prescribed that the management authority should extend this study for other coastal governorates and investigate the potential causes of inefficiency to help design effective management strategies.
