MARKETING, TRADE, AND MANAGEMENT OF AQUACULTURE AND FISHERY RESOURCES

• Sponsoring Institution: National Institute of Food and Agriculture
• Project Status: COMPLETE
• Funding Source: HATCH
• Reporting Frequency: Annual
• Accession No.: 1006239
• Multistate No.: W-3004
• Project Start Date: Jul 30, 2015
• Project End Date: Sep 30, 2019
• Program Code: [(N/A)]- (N/A)

Recipient Organization
UNIVERSITY OF RHODE ISLAND
19 WOODWARD HALL 9 EAST ALUMNI AVENUE
KINGSTON,RI 02881

Performing Department
Environmental & Natural Resource Economics

Non Technical Summary
Sustainable seafood market project:Certification labels for commercially caught fish and crustaceans is a growing trend whose premise is the creation of incentives that will encourage fishing firms to employ more sustainable practices. For the most part, this trend was fueled by the growth of the Marine Stewardship Council (MSC). Moving forward, however, there are several certification programs with varying levels of participation by the retail and producing sector that could give rise to competition to MSC and between these new labels. Another issue that established certification programs face is how to 'reward' those fisheries making progress towards certification, but not yet not at conditions necessary to achieve the status. Fisheries Improvement Projects (FIPs) have partially filled that niche. The implications of the changing landscape of seafood certification both in terms of the competing labels and providing the fruits of certification to fisheries not yet achieving the standards remain unclear. Some outstanding questions to be answered include whether FIPs undermine the goal of obtaining an increasing number of fully certified fisheries and whether the multiple competing labels will undermine the potential gains of the demand-side interventions. The goal of this project is to provide information that will deliver food-for-thought related to the continuing evolution of the market for sustainable seafood, and the relative contributions of fisheries certification and FIPs in achieving market-based incentives for ocean conservation.Shellfish farming and food-borne disease risk project:The goal of this proposed project is to enhance the resilience of the oyster aquaculture industry against the risk of food-borne disease outbreaks. With a focus on the demand side of farmed oysters, this project will examine consumers' behavior in response to food-borne disease outbreaks, and investigate potential response strategies for farmers. To achieve our goal, we will use experimental auctions combined with deliberation methods to estimate (a) the impact on Rhode Island (RI) oyster and shellfish demand of the negative information spillover effect from disease outbreak in oyster farms, where "negative information spillover effect" is defined as the change in consumers' behavior based on information inferred from but not explicitly contained in a message; and (b) the effectiveness of positive information (i.e. information aimed to reassure consumers about the product safety) on counteracting the negative spillover effect.

Animal Health Component

80%

Research Effort Categories

Basic

0%

Applied

80%

Developmental

20%

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
605	3723	3010	100%

Knowledge Area
605 - Natural Resource and Environmental Economics;

Subject Of Investigation
3723 - Oysters;

Field Of Science
3010 - Economics;

Keywords

seafood ecolabel

food borne disease

oyster farming

economic experiment

deliberation

Goals / Objectives
Improve the development of seafood markets by focusing on analyses of new marketing themes, market niches, and alternative seafood products Enhance fishery and aquaculture production by developing decision support tools to integrate management and marketing Increase the organizational and institutional efficiency of the aquaculture and fishery sectors by analyzing the regulatory environment and developing ideas to support the sectors

Project Methods
For sustainable seafood market project:[1] Review academic literatureTo understand the current state of knowledge on our project goals listed above, we will review the existing published literature during January - March. This will include literature on:Consumer demand for certified sustainable seafood as well as other credence goods such as fair trade, organic, forest certified, and others (see e.g., Roheim, Asche, and Santos 2011; Salladarré et al. 2010; Uchida et al. 2014; Uchida et al. 2013; Onozaka and Thilmany McFadden 2011; Bougherara, Grolleau, and Mzoughi 2009);Consumers' and buyers' trust in certifications, aka the role of credibility in demand for certification;The role that structure of the supply chain plays in seafood marketing, i.e., a short supply chain versus a long supply chain, as well as market power within the supply chain (Vallejo, Hauselmann, and Asante 2009). This will include the industrial organization literature which discusses brand competition in the marketplace, and drivers for brand differentiation (Shapiro 1982);Drivers that Corporate Social Responsibility (CSR) may play in demand for sustainable seafood, and the use of CSR as a firm's competition strategy (e.g., Saeed and Arshad 2012); andLiterature on insurance, and use of brands or other differentiation methods to provide insurance in the face of negative media or events.[2] Ground truth findings from literature review through informal discussions with industry and FIPsWe anticipate that the literature review will present a series of hypotheses as to what drives demand for sustainable seafood, and what might affect the relative positioning of FIPs versus certification - as well as how the various certifications substitute for one another. For example, the academic literature discusses several possibilities, such as consumer driven demand, corporate social responsibility behavior, and competition for market placement in an increasingly concentrated and competitive grocery industry. Other possibilities include a demand for certification as a form of insurance for brand reputation (Asche and Roheim 2008). In order to place these hypotheses in the context of current behavior and practice within the seafood sector, we will conduct a series of discussions with individuals in the seafood supply chain.[3] OutreachWe intend to propose a special session on this subject to be held at the biannual meeting of North American Association of Fishery Economists (NAAFE), which will be held in May 2015 in Ketchikan, Alaska. The special session will serve two purposes: 1) to raise the profile of the issues identified in efforts I - III above to members of our disciplinary field, hopefully spurring other researchers to begin their own investigations of these complex issues; and 2) to obtain feedback from other fisheries economists in academia, regulatory agencies, and environmental NGOs, as well as non-economists from a diverse set of backgrounds. Such feedback will strengthen content of the subsequent white paper.[4] Develop White PaperA draft of the white paper will be created at a retreat of the four PIs of this project plus the graduate student. The retreat will focus on synthesizing the information collected to date, and form the basis for developing the white paper.For food-borne disease risks and shellfish farming project:Core components of this project, described below, will be suppprted throughthe Department of Commerce - NOAA Sea Grant for FY2014-15. ThisHatch Multi-state project fundingis sought to supplement the Sea Grant funding; in particular for the support of additional graduate student assistant (preferably a PhD student) and some domestic traveling related to the project.Details of this project are outlined below. Graduate student assistant supported by thei Hatch project will be involved in some or all of the components.[1] Obtain information for designing the experiment and surveyTo ensure our experimental design and analyses are relevant to the needs of stakeholders, we will conduct a series of focus groups and interview sessions to obtain information that will guide us in developing the survey and information treatment materials. We will also conduct interviews with RI oyster aquaculturists, both members and non-members of the Ocean State Shellfish Cooperative, that will focus on their perceptions of the food-borne disease-related negative information spillover effect, as well as the feasibility of positive counter-information schemes such as certification and labeling.[2] Economic experiments to estimate information effectsWe will use the experimental auction method. Experimental auction is widely used in economics to reveal consumers' willingness to pay for existing and newly developed products.A short survey both before and after the experiment will collect demographic information of the participants, as well as their attitudes and perceptions of oysters, shellfish, and aquaculture.There are a few prerequisites for auction bids to reveal participants' true value for the product. First, we will employ an auction method known as Vickrey auction, which is a second price sealed-bid auction and theoretically incentive-compatible, i.e., it is in the participants' best interest to bid their true value (Vickrey 1961). Second, because shellfish is perishable, we could encounter a problem where participants like oysters and quahogs in general, but just happen to not want them on the particular day they participated. To avoid this problem, we will prepare vouchers that can be exchanged for a dozen pieces of a shellfish product at a designated retail outlet on the day of their choice. Auction winners will receive the voucher instead of actual shellfish. This will also solve the problem of handling shellfish on our own. Lastly, in a repeated-auction session such as ours we need to consider the budget-effect problem. This is where the bids in later rounds are affected by participants thinking that they might have won in an earlier round. To eliminate this problem, we will use the binding-round system: after all rounds are done, one round is randomly chosen and the winner of that round will be asked to actually pay and receive the item. With this system a participant can at most win just one item, thereby eliminating the budget-effect.We will run six sessions for each of the six versions, thus making the total number of 36 sessions for this project.[3] DeliberationThe proposed research also asks whether opportunities to discuss relevant issues influences consumer attitudes towards shellfish consumption-related risks. While all research participants will receive written information about the food-borne disease risks and a hypothetical labeling program, participants in some sessions will also engage in a facilitated deliberation of key issues. Deliberation has been defined as "debate and discussion aimed at producing reasonable, well-informed opinions in which participants are willing to revise preferences in light of discussion, new information, and claims made by fellow participants" (Chambers 2003, p.309). A growing literature addresses the effects of deliberation on attitude formation and its potential as a tool for changing or crystalizing existing attitudes (e.g., Fishkin and Luskin 2005). These studies include willingness to pay and other valuation studies, with deliberation used to ensure that research participants provide well-informed and considered responses (Dietz, Stern, and Dan 2009; Spash 2007; Spash 2008). By exposing participants to a broad pool of ideas and promoting the consideration of multiple perspectives, deliberation can help align attitudes with underlying interests and facilitate more sophisticated and reasoned judgments.

Progress 07/30/15 to 09/30/19

Outputs
Target Audience:Commercial fishers and regulators Aquaculturists Consumers and market actors NGOs and Foundations Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?During the course of this project, a total of three PhD students and one MS student were involved and all graduated successfully with the degree. One of them,Michael Wei, who was the lead investigator for theGM seafood project, was awarded the Best Student Paper award at the North American Association of Fisheries Economists Forum 2019. How have the results been disseminated to communities of interest? Nothing Reported What do you plan to do during the next reporting period to accomplish the goals? Nothing Reported

Impacts
What was accomplished under these goals? Sustainable seafood market project Certification labels for commercially caught fish and crustaceans is a growing trend whose premise is the creation of incentivesthat will encourage fishing firms to employ more sustainable practices. For the most part, this trend was fueled by the growth ofthe Marine Stewardship Council (MSC). Moving forward, however, there are several certification programs with varying levels ofparticipation by the retail and producing sector that could give rise to competition to MSC and between these new labels.Another issue that established certification programs face is how to 'reward' those fisheries making progress towardscertification, but not yet not at conditions necessary to achieve the status. Fisheries Improvement Projects (FIPs) have partiallyfilled that niche. The implications of the changing landscape of seafood certification both in terms of the competing labels andproviding the fruits of certification to fisheries not yet achieving the standards remain unclear. Some outstanding questions to beanswered include whether FIPs undermine the goal of obtaining an increasing number of fully certified fisheries and whether themultiple competing labels will undermine the potential gains of the demand-side interventions. The goal of this project is toprovide information that will deliver food-for-thought related to the continuing evolution of the market for sustainable seafood,and the relative contributions of fisheries certification and FIPs in achieving market-based incentives for ocean conservation.This project addresses primarily Goal (1) above. The project started with extensive literature reviews and a series of informal interviews with industry and FIPs. Between these two activities, we alsoorganized a special session during a professional meeting of the North American Association of Fisheries Economists to solicitinputs from academics and experts on the topic.Afterinterviews werecompleted, theteam met in Davis, CA, for a three-day retreat to flush out the contents of the white paper, which eventually became a coauthoredacademic paper. The draft paper was then presented at a workshop on "Learning from Nearshore SustainabilityScience" in June 2016 and also ata conference of NorthAmerican Association of Fisheries Economists held in La Paz, Mexico, in March 2017. The project concluded that the sustainable seafood movement is at a crossroads:its core strategy, also known as a theory of change, is based on market-orientedinitiatives such as third-party certification but does not motivate adequate levels of improved governance and environmentalimprovements needed in many fisheries, especially in developing countries. Price premiums for certified products areelusive, multiple forms of certification compete in a crowded marketplace and certifiers are increasingly asked to address socialas well as ecological goals. Theprojecttracedhow the sustainable seafood movement has evolved over time to address newchallenges while success remains limited,andexploredfour alternative potential outcomes for the future theory ofchange, each with different contributions to creating a more sustainable global seafood supply.The paper from the project waspublished in Nature Sustainability. Food-borne disease risks and shellfish farming project The goal of this proposed project is to enhance the resilience of the oyster aquaculture industry against the risk of food-bornedisease outbreaks. With a focus on the demand side of farmed oysters, this project will examine consumers' behavior inresponse to food-borne disease outbreaks, and investigate potential response strategies for farmers. To achieve our goal, weused the experimental auctions combined with deliberation methods to estimate (a) the impact on Rhode Island (RI) oyster andshellfish demand of the negative information spillover effect from disease outbreak in oyster farms, where "negative informationspillover effect" is defined as the change in consumers' behavior based on information inferred from but not explicitly containedin a message; (b) the effectiveness of positive information (i.e. information aimed to reassure consumers about the productsafety) on counteracting the negative spillover effect.This project addresses Goal (2) and (3). The auction experiment, survey, and the context of information treatments were all developed with the help from the industry consultant. We solicited on average 10 participants per session.In a typical session,participants first took the pre-experiment survey, then engaged in the auction experiment where they placed bids for raw oyster dish at a reputable restaurant (the winner received a gift certificate). Certain information about the foodborne disease and countermeasures were provided during the experiment. After the experiment, the participants filled out the post-experiment survey. The experiment was completed with 34 sessions and 359 participants from across the state. We had budgeted for a total of 360 participants so we were able to reach that goal. The data was also well-balanced as we obtained 55-58 participants for each information treatment. The analysis of the data is still ongoing as part of a Master's student's major paper and expected completion by May 2020. From genetically modified farmed seafood project This was a new project that started during the previousreporting period (2017-18), inspired by the FDA-approved genetically modifiedfarmed salmon. This project addresses Goals (1) and (2).Genetic modification technology influence is expanding in the seafoodindustry, ranging from GM seafood (salmon) to farmed fish being fed GM-originfeed. With the new GM food labeling policy about to be in place, theanalysis of consumers' demand for GM seafood was deemedtimely and with highpolicy relevance. We developed a survey consulting with internal stakeholders. Thecompleted survey was then published and conducted on Amazon Mechanical Turk (MTurk) platform to solicit responses nationwide. Wecollected data from 1,041 participants who were asked to choose betweenfresh Atlantic Salmon fillets with labels denoting the presence or absenceof GM technology and some were provided information with varyingsupport of GM technology. We found that participants are willing to pay a premium for fillets labeled asVerified Non-GM (29%), Organic (2%), or Fed-GM (18%) but require adiscount for fillets labeled GM (14%). Participants receiving any informationare willing to pay a substantial premium (> 100%) for Verified Non-GMfillets regardless of the information's stance, while participants receivingbalanced information require a 101% discount for GM fillets. We proposefocusing outreach efforts on improving consumers' mechanistic knowledgeabout GM technology and promoting transparency in the marketing of GMfoods.

Publications

• Type: Journal Articles Status: Under Review Year Published: 2019 Citation: Weir, M.J., H. Uchida, and M. Vadiveloo. 2019. National bioengineered food disclosure standard and the polarizing effect of market information on demand for genetically modified seafood. Food Policy (submitted)

Progress 10/01/17 to 09/30/18

Outputs
Target Audience:Commercial fishers and regulators Aquaculturists Consumers and market actors NGOs and Foundations Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?We continued to support a Ph.D. student, Chao Zou, in the Sustainable Seafood Market project. He has successfully finished the program and acquired the degree in May 2018. For the food-borne disease risk project, another Ph.D. student, Michael Weir, was involved as a research assistant andhelped run the experimental auction sessions and continued on with the data analysis. He also began the genetically modified seafood project as part of his dissertation. How have the results been disseminated to communities of interest? Nothing Reported What do you plan to do during the next reporting period to accomplish the goals?The sustainable seafood market project is completed with the journal article now being published. Formal graduate student, Chao Zou, is continuing the same theme on Chinese seafood market and consumers. This is technically outside of the scope of W3004 project, but closely related one nonetheless. The foodborne disease risk project has completed the data collection and its analysis is currently underway. The new genetically modified seafood project has completed collecting the first round of survey data and its analysis is currently underway. Based on the findings from this survey data, we will be developing a few follow up projects on this theme. GM seafood is one of the topics included in the renewal proposal for W4004 starting Oct 2019 (if approved).

Impacts
What was accomplished under these goals? From sustainable seafood market project: This project addresses primarily Goal (1). Last year we had a journal submission being rejected and resubmitted to a different journal. That submission was eventually accepted, and the article was published in August 2018 issue of Nature Sustainability. From food-borne disease risks and shellfish farming project: This project addresses Goals (2) and (3). During this reporting project, we spentmost of the time analyzing the data. Due to factors beyond our control, the progress has been slower than I wouldhave liked; we are continuingour effort toget theanalyses done and disseminatethe results. From genetically modified farmed seafood project: This is a new project that started during this reporting period, inspired by the recently FDA-approved genetically modified farmed salmon. This project addresses Goals (1) and (2). It started as a chapter of a dissertation, and we have completed running an online choice experiment survey using Amazon MTurk on 1000 respondents. Data analysis is currently ongoing.

Publications

• Type: Journal Articles Status: Published Year Published: 2018 Citation: C. A. Roheim, S. R. Bush, F. Asche, J. N. Sanchirico, and H. Uchida. 2018. Evolution and future of the sustainable seafood market. Nature Sustainability 1, 392-398.
• Type: Conference Papers and Presentations Status: Accepted Year Published: 2018 Citation: Zou, C., and H. Uchida. 2018. A Study of Chinese Consumers Preference for Sustainably Farmed Seafood Using Experimental Auctions. Biennial Conference of International Institute of Fisheries Economics and Trade. Seattle, WA.

Progress 10/01/16 to 09/30/17

Outputs
Target Audience:Commercial fishers and regulators Aquaculturists Consumers and market actors NGOs and Foundations Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?We continued to supporta Ph.D. student, Chao Zou, in the Sustainable Seafood Market project. Hatch funding was utilized to have Chao attend the NAAFE Forum 2017 conference in La Paz, Mexico, to present his work insustainable and safe seafood in China, which is an extension of this project and also part of his dissertation research. For the food borne disease risk project, another Ph.D. student, Michael Weir, was involved as a research assistant and helped runthe experimental auction sessions. How have the results been disseminated to communities of interest?From sustainable seafood market project: Main findings were presented at NAAFE Forum 2017 conference. From food-borne disease risk and shellfish farming project: Nothing to report at this time. What do you plan to do during the next reporting period to accomplish the goals?The sustainable seafood market project is completed, apart from getting an academic paper published. This effort is currently underway. The food borne disease risk project will complete the experimental auction sessions when either a total of 36 sessions or 360 participants is reached. Data analyses will follow, with planned presentation of results at professional conferences such as the International Institute of Fishery Economics and Trade to be held in July of 2018.

Impacts
What was accomplished under these goals? From sustainable seafood market project: This project addresses primarily Goal (1). All research activities were completed; focus during this reporting period has been disseminating the findings and developing a journal paper. To that end, we presented the findings at a conference of North American Association of Fisheries Economists held in La Paz, Mexico, in March 2017. A journal paper we submitted during thelast reporting period was unfortunately rejected for publication, but we revised the paper and resubmitted to a different journal and it is currently under review. From food-borne disease risks and shellfish farming project: This project addresses Goals (2) and (3). During thisreporting project, we conducted the planned experimental auction sessions across the state in places including Providence, Newport, and Warwick. Of the planned 36 sessions in total,21 sessions with 223 participants were completed by 9/30/17.

Publications

• Type: Conference Papers and Presentations Status: Accepted Year Published: 2017 Citation: Roheim, C.A., S. Bush, H. Uchida, J. Sanchirico, F. Asche, and C. Zou. 2017. A new theory of change for the sustainable seafood movement. North American Association of Fisheries Economists Forum 2017. La Paz, Mexico.
• Type: Journal Articles Status: Under Review Year Published: 2017 Citation: Roheim, C.A., S. Bush, H. Uchida, J. Sanchirico, F. Asche, and C. Zou. 2017. The Evolving Theory of Change for Sustainable Seafood. Nature Sustainability.

Progress 10/01/15 to 09/30/16

Outputs
Target Audience:Commercial fishers and regulators Aquaculturists Consumers and market actors NGOs and Foundations Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?Ph.D. student Chao Zou, who joined the sustainable seafood project from the second half of 2013, has been involved throughout such that he is properly listed as a co-author of the academic paper the project produced. He has since then extended the project theme to investigating the market for sustainable and safe seafood in China as part of his dissertation research. How have the results been disseminated to communities of interest?From sustainable seafood market project: Albeit small in scale, the workshop on Learningfrom Nearshore Sustainability Science was well-attended by both researchers in the field of studying various aspects of nearshore fisheries and Packard Foundation representatives who are interested in supporting such research projects. From food-borne disease risk and shellfish farming project: Nothing to report at this time. What do you plan to do during the next reporting period to accomplish the goals?For both projects, we will proceed as outlined in our initial plan. At the moment there are no needs to engage in any activities that were not in the original plans.

Impacts
What was accomplished under these goals? From sustainable seafood market project: This project addresses primarily Goal (1). At the beginning of the reporting period, we continued with the informal discussions with seafood supply chain representatives on market for certified seafood and the role of FIPs. After this was completed, the team met in Davis, CA, for a three-day retreat to flush out the contents of the white paper, which eventually became a co-authored academic paper. The draft paper was then presented at a workshop on "Learning from Nearshore Sustainability Science" in June 2016. The paper is now submitted to a journal and is under review. From food-borne disease risks and shellfish farming project: This project addresses Goal (2) and (3). During this reporting project, experiment design and survey questions were developed and completed. The registering of an industry consultant to help us with the experiment design, and the review process by IRB took longer than anticipated, but as of now both are completed and in place.

Publications

• Type: Journal Articles Status: Under Review Year Published: 2016 Citation: Bush, S., C. Roheim, H. Uchida, J. Sanchirico, F. Asche, and C. Zou. 2017. A New Theory of Change for the Sustainable Seafood Movement. Conservation Biology, under review.

Progress 07/30/15 to 09/30/15

Outputs
Target Audience:Commercial fishers and regulators Aquaculturists Consumers NGOs and Foundations Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?Graduate student, Pratheesh Sudhakaran, successfully completed his PhD degree requirements based on his involvement with this project. He has officially graduated with the degree in Summer 2015. Graduate student, Chao Zou, joined the project from the second half of 2013. He is working on the analysis of ecolabeled seafood markets with particular focus on the demand for such products by retailers and upstream supply chain stakeholders. He is planning to take this project as a springboard for his dissertation. How have the results been disseminated to communities of interest?From sustainable seafood market project: Aspecial session was organized forNorth American Association of Fisheries Economists Forum 2015, which was held in Ketchikan, AK, in May 2015. It was attended by 30-40 participants, mostly academics but also included a few government officials and industry experts. The session was in part disseminating our findings from our extensive literature review, and in part soliciting inputs from these experts on other aspects of the topic that we might have missed. Fromfood-borne disease risks and shellfish farming project: Nothing to report at this time. What do you plan to do during the next reporting period to accomplish the goals?For both projects, we will proceed as outlined in our initial plan. At the moment there are no needs to engage in any activities that were not in the original plans.

Impacts
What was accomplished under these goals? From sustainable seafood market project: This project addresses primarily Goal (1) above. Planned activities were taken in developing a document (white paper and potentially a journal article) analyzing the markets for sustainable seafood and the relations between different types of sustainable seafood. These activities include an extensive literature reviews (completed), andground-truth findings from literature review through informal discussions with industry and FIPs (ongoing). Between these two activities we also organized a special session during a professional meeting of North American Association of Fisheries Economists to soclicit inputs from academics and experts on the topic. Fromfood-borne disease risks and shellfish farming project: This project addresses Goal (2) and (3). The project is in the process of developing the experiment design to be conducted in 2016, where auctions for actual farmed oysters will be organized with actual consumers as participants. During this reporting period, the content of information treatments to be employed during the experiment was developed and completed; the survey questions are in its final draft.

Publications