A Multi-regional Economic Impact Analysis of Alaska Salmon Fishery Failures

Recently, the harvest of Chinook salmon (Oncorhynchus tshawytscha) in some areas of Alaska was severely curtailed due to a significant reduction in the salmon runs. This generated adverse economic impacts in the areas. Unlike previous studies of impacts of changes in fisheries, which often rely on single-region economic impact models, this study uses a multi-regional social accounting matrix (MRSAM) model of three US regions - Alaska, West Coast, and the rest of US - to calculate the multi-regional economic impacts of the Chinook salmon fishery failures, considering the countervailing effects of federal disaster funds paid to commercial salmon fishermen. To estimate the negative effects of the reduced salmon harvest, this study uses “adjusted demand-driven MRSAM model”, which avoids the double-counting problem encountered when a demand-driven model is used to compute the effects of exogenous output change, and overcomes the weakness of Ghosh (1958) approach in estimating the forward-linkage effects. To calculate the positive effects of federal relief payments, this study uses a Leontief demand-driven MRSAM model. Results indicate that the salmon fishery failures have significant adverse economic impacts including both intra-regional (Alaska) and inter-regional (West Coast and the rest of US) impacts, and that the disaster relief mitigates only a small portion of the adverse impacts.