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This paper investigates habitat-fisheries interaction between two important resources in the Chesapeake Bay: blue crabs and submerged aquatic vegetation (SAV). A habitat can be essential to a species (the species is driven to extinction without it), facultative (more habitat means more of the species, but species can exist at some level without any of the habitat) or irrelevant (more habitat is not associated with more of the species). An empirical bioeconomic model that allows for all three possible relationships was estimated and two alternative approaches were used to test whether SAV matters for the crab stock. Our results indicate that a model that incorrectly assumes that habitat is essential to a species can result in model misspecification and biased estimates of the impact of habitat on species productivity. Using a model that assumes an essential relationship, we find that SAV has a significant positive impact on blue crab productivity (p<0.001). However, in a more general model, we failed to reject the null hypothesis that SAV is irrelevant for crabs in the Bay (p>0.05).
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