Renewable Common-Pool Resources: Fisheries and
Other Commercially Valuable Species
Growth rate (replacement) and size
of the fish stock/pool
• Too Small/Low Stock Size
• Lower growth rate as fish can’t hook up and reproduce
• Birth (replacement) less than death/harvest
• Growth rate declines; species becomes extinct
• Too Large Stock Size
• Food sources (plankton, biomass, other fish) too small to
support large # of fish
• Growth rate declines
Schaffer model: Relationship between
the Fish Population and Growth
How do we use this to manage the
fisheries (prevent extinction)
• Compare
• Open Access Fishery (Tragedy of the Commons)
• Everyone who has a boat can harvest as many fish as they can
catch profitably
• Maximum Sustainable Yield (MSY)
• What is the largest stock of fish that can be sustained from one
year to the next (harvest = growth rate at max stock size)
• Economically Efficient
• Given costs/benefits – what is the efficient harvest
3 Possible Solutions
• 1.
Open (unregulated) Fisheries (Ec)
• Catch until total costs exceed revenues (up to zero profits) =>
ATC(Q) = TotRev(Q) = P*Q
• 2.
Maximum Sustainable Yield(MSY) (Em)
• Largest “harvest” that can be sustained every year (harvest =
replacement rate)
• Biologist solution
• 3. Economically Efficient (Eo)
• Maximize Economic Value MC(Q) = MR(Q)
FIGURE 14.2
Efficient Sustainable Yield for a
Fishery
Policy Options
• Command and Control (Regulation)
• Set Quota for number of fish that can be caught
•
•
•
Ignores differences in costs/efficiency of fishermen
Can lead to over capacity (too many boats, too big)
Discarded catch/by-catch issues
• Tradable permits (ITQs)
•
•
•
•
•
Determine optimal “harvest” and number of licenses to be issued
Divide quota/target by number of license = #fish caught per license
Auction or grandfather licenses
Allow owners to trade (one-year, or multi-year)
Multi-species/by-catch
• Taxes
•
Per unit tax on the #fish caught
Individual Transferable Quotas (ITQs)
• An efficient quota system will have the following
characteristics:
• The quotas entitle the holder to catch a specified volume
of a specified type of fish.
• The total amount of fish authorized by the quotas should
be equal to the efficient catch level for that fishery.
• The quotas should be freely transferable among fishermen.
• Taxes also raise the real cost of fishing, but do so in
an efficient manner.
• Unlike regulations, the tax can lead to the static-efficient
sustainable yield allocation
• For the individual fisherman, however, a tax still represents
an increase in costs – internalize the externality cost
• Taxes also raise the real cost of fishing, but do so in
an efficient manner.
• Unlike regulations, the tax can lead to the static-efficient
sustainable yield allocation because the tax revenues
represent transfer costs and not real-resource costs.
• Transfer costs involve the transfer of resources from one
part of society to another.
• For the individual fisherman, however, a tax still represents
an increase in costs.
FIGURE 14.7 Effect of Regulation
Individual Transferable Quotas (ITQs)
• An efficient quota system will have the following
characteristics:
• The quotas entitle the holder to catch a specified volume
of a specified type of fish.
• The total amount of fish authorized by the quotas should
be equal to the efficient catch level for that fishery.
• The quotas should be freely transferable among fishermen.
TABLE 14.1 Countries with
Individual Transferable Quota
Systems
Subsidies and Buy Backs
• One of management options to reduce overcapacity.
• Payments used to buy out excess fishing capacity are useful
subsidies, but if additional capacity seeps in over time, they
are not as effective as other management measures.
• Coos Bay, Ore
• Prior to ITQ’s existing fleet: 450-500 vessels
• Optimal – 250 vessels; buy back of excess vessels
• Marine protected areas and marine reserves are areas
that prohibit harvesting and are protected from other
threats such as pollution.
• Marine protected areas are designated ocean areas within
which human activity is restricted.
• Marine reserves protect individual species by preventing
harvests within the reserve boundaries.