Basque inshore skippers' long term behaviour: a logit approach

Abstract

Based on the discrete optimal choice theory and a random utility model (RUM) framework, this paper focuses on the firm's long-term choices.A behavioural study on the stay and exit decisions of the fishing firms belonging to the inshore fleet of the Basque Country is undertaken by estimating a logistic model from a set of socio-economical sample panel data for the period 2003-04. Specifically, we aim to determine the set of vessels', skippers' and economic variables that may influence the probability of a fishing vessel to exit from the fishing activity. Special attention will be paid to the roll that incentives generated by decommissioning grants play in the fishermen's long-term behaviour. Our results indicate that the owner's age, years of experience being a skipper, the arrangement of continuity in the familiar business, the degree of dependency upon bank loan and lastly but not least decommissioning grants may significantly determine the decision to abandon the activity.