The relation between fishing subsidies and CO2 emissions in the fisheries sector

The relation between fisheries subsidies and their effects on the level of resource extraction is widely discussed in extant literature. However, in addition to impacts on the level of fishing, the various types of subsidies can generate different incentives for greenhouse gas emissions, a subject that is still little explored. Thus, this article aims to evaluate the influence of fishing subsidies on the sector's CO2 emissions. It is worth noting that three groups of subsidies were evaluated, the beneficial (Good), the capacity-enhancing (Bad) and the ambiguous (Amb), classified by Sumaila et al. (2010), who proposed such a division based on the negative effects on sustainability of fish stocks. To this end, an annual data panel was constructed for 14 developed countries from 2005 to 2012. The Dynamic Panel method was adopted as empirical strategy as well as the estimator proposed by Everaert and Pozzi (2007) to correct possible biases associated with micronumerosity in dynamic models. The results indicate that Bad subsidies generally point to increased CO2 emissions. Amb subsidies, which are not clearly defined in the literature, have no significant relationship with emissions. Finally, Good subsidies are also inversely related to CO2 emissions from the fishing industry.