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While environmental stressors such as hypoxia (low dissolved oxygen) are perceived as a threat to the productivity of coastal ecosystems, policy makers have little information about the economic consequences for fisheries. Prior studies based on data aggregated at relatively large spatial (e.g.,1000s km) and temporal (e.g., annual) scales have typically not detected statistically significant effects of hypoxia on fisheries. Whether this finding is due to the low statistical power associated with the use of aggregate data or the lack of realized effects on fisheries is an open question. Recent work uses disaggregated fishing data (microdata) and finds significant but modest effects of hypoxia on recreational catches. However, previous work ignores important aspects of how hypoxia effects harvest. In particular, the effects of hypoxia on catch may not occur instantaneously but instead may involve a substantial temporal lag in which catches reflect cumulative past exposure to low dissolved oxygen. We develop a bioeconomic model that accounts for potential lagged effects using fishery-dependent data from North Carolina’s brown shrimp fishery. We find that hypoxia is responsible for an 12.9 % decrease in NC brown shrimp catches from 1999-2005 in the Neuse River Estuary and Pamlico Sound, assuming that vessels do not react to changes in abundance. We then explore the full economic consequences of hypoxia on the supply and demand for shrimp. Demand analysis reveals that the NC shrimp industry is too small to influence prices, which are driven entirely by imports and other domestic