IIFET 2012 Tanzania Proceedings
The Economic Consequences of Regime Shifts in Marine Ecosystems
Lorena Gola*, Martin Quaas*
* Kiel University
Abstract
By 1992, the Canadian cod populations collapsed and a moratorium on fishing was declared, which
remains in place until today. Ecologists suspect that the marine ecosystem at the Canadian east coast has
shifted towards a new regime, where cod stocks remain at a low level while other species biomass levels,
especially cod prey, including forage fishes, shrimp and large crustaceans remain high. Meanwhile, the
economic importance of lobster, snow crab, shrimp, caplin, halibut and other fisheries increased and
represent currently the most valuable fisheries in Atlantic Canada. To study the economic consequences
of the regime shift, we set up a bioeconomic model considering three species (or species groups), cod,
pelagics, and shellfish. Cod preys on shellfish and pelagics but is also controlled by competition and
predation by pelagic species in early live stages. We study (a) the implications for efficiency, i.e. the
aggregate economic benefits derived from using the ecosystem with and without a regime shift, and (b)
the distributional implications of a regime shift, i.e. the distribution of benefits for different stakeholder
groups from using the ecosystem with and without a regime shift. We find that, in terms of the aggregate
present value of incomes, the shift the North West Atlantic ecosystem resulted only in a small net loss for
the Newfoundland region, but that the net welfare loss main have been large, given the distributional
effects on different groups of fishermen.