Fig. 4: Sensitivity of equilibrium points to cost structure for wild totoaba stock.
From: Substantial gains and little downside from farming of Totoaba macdonaldi
Logistic growth function (black) for Totoaba macdonaldi wild stock biomass with intersecting colored lines representing different market structures and competitive responses. Harvest under the status quo vertical monopoly is represented by the green curve. When conservation farming is added to the monopoly scenario the trader can respond either in a mutually beneficial way by adjusting the quantity supplied given a market price (quantity adjustment, in blue). Alternatively, the trader can respond aggressively and try to set a price that undercuts the price of farmed products, resulting in increased poaching (price setting, in red). Cost parameters W1 and W2 correspond to the linear quadratic cost structure. In the top panel, equilibria are displayed for the linear quadratic cost, on the bottom, for a quadratic cost. On the left panel, the quadratic component is large, and vertical monopoly maintains a healthy stock. Center panel highlights the baseline scenario. In the right panel, the cost structure is close to linear. In this case, the vertical monopoly may lead to drastic stock decline.
