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This paper investigates whether rights-based management in fisheries ends the “race to fish.” The staggered introductions of catch shares in the Alaska pollock and Pacific hake fisheries—neighboring regional fisheries that are the largest and sixth largest fishery by volume in the United States, respectively—provide a unique natural experiment for...
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Context 1
... two fisheries are harvested and processed by similar technologies (see table 1). They produce similar end products-namely, surimi, fillets, and mince and meal-that are sold in similar global markets. ...
Context 2
... a hake catcher-processer that also participates in the pollock fishery, it appropriates about 16 fewer days at sea har- vesting hake relative to a hake harvester that only fish hake (statistically significant at the 10% level). These results are consistent with the fact that close to three-quarters of vessels in the hake fishery go up to Alaska (see appendix table A1). ...
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Citations
... ; Hsueh (2017); Pincinato et al. (2022) conduct ex post policy evaluation to provide important results on the performance of catch shares. However, these models are unable to identify the precise mechanisms driving those changes and thus have limitations for evaluating the effects of proposed new policies ex ante (Lucas, 1976). ...
... An unregulated fishery will eventually drive down harvest to the point that fishermen will only pursue the species to the point of covering their business costs and opportunity costs. A regulated, limited entry fishery may do the same, although at a higher harvest level and with better protection of the underlying stock [18,19]. In either case, the regulations restrict options and hence lead to inefficiencies. ...
In the southeast U.S., two very similar fisheries are managed by very different management regimes. In the Gulf of Mexico Reef Fish fishery, all major species are managed by individual transferable quotas (ITQs). The neighboring S. Atlantic Snapper-Grouper fishery continues to be managed by traditional regulations such as vessel trip-limits and closed seasons. Using detailed landings and revenue data from logbooks together with trip-level and annual, vessel-level economic survey data, we develop financial statements for each fishery to estimate cost structures, profits, and resource rent. By comparing the two fisheries from an economic perspective, we illustrate the detrimental effects of the regulatory measures on the S. Atlantic Snapper-Grouper fishery and quantify the difference in economic outcomes, including estimating the difference in resource rent. We find that the choice of fishery management regime shows up as a regime shift in the productivity and profitability of the fisheries. The ITQ fishery generates substantially more resource rents than the traditionally managed fishery; the difference is a large fraction of revenue (~30%). In the S. Atlantic Snapper-Grouper fishery, the potential value of the resource has almost completely dissipated via lower ex-vessel prices and hundreds of thousands of gallons of wasted fuel. Excess use of labor is a lesser issue.
... The literature using quasi-experimental methods to evaluate fisheries policies has grown significantly in recent years. Most studies focus on individual fisheries (Smith et al., 2006;Abbott and Wilen, 2010;Reimer and Haynie, 2018), with a lot of recent work specifically designed to evaluate the consequences of implementing catch shares (Scheld et al., 2012;Kroetz et al., 2015;Cunningham et al., 2016;Pfeiffer and Gratz, 2016;Hsueh, 2017;Ardini and Lee, 2018;Pfeiffer et al., 2022;Pincinato et al., 2022). Only a handful of published quasi-experimental studies are comparative across many fisheries (Costello et al., 2008(Costello et al., , 2010Birkenbach et al., 2017;Sakai, 2017;Erhardt, 2018;Isaksen and Richter, 2019), and none have evaluated the revenue impacts of catch shares. ...
... By allocating a fixed share of the annual catch to an individual entity, catch share systems change incentives, leading to anticipated and unanticipated changes in behavior and outcomes. Catch share programs have been found to lead to improvements along in many metrics, including productivity (Färe et al., 2015;Walden et al., 2012;Weninger, 1998), revenue (Kroetz et al., 2017;Scheld et al., 2012), profitability (Fox et al., 2003), output quality (Ardini and Lee, 2018;Casey et al., 1995;Kroetz et al., 2019), prices (Dupont et al., 2005;Pincinato et al., 2022), season length (Agar et al., 2014;Birkenbach et al., 2017;Hsueh, 2017), safety (Pfeiffer et al., 2022;Pfeiffer and Gratz, 2016), and crew compensation (Abbott et al., 2010(Abbott et al., , 2022Steiner et al., 2018). ...
In 2010, the Northeast United States groundfish fishery adopted a catch share system in which Annual Catch Entitlements (quota) are allocated to groups of firms, known as sectors. The quota market has many features that differ from an ideal market: trades are facilitated by sector managers, completed trades are not easily seen by all, and both package and barter trades are common. This paper examines quota prices using a two stage econometric model. In the first stage, transactions data are used to estimate the prices of individual stocks of quota. In the second stage, a hurdle model is used to understand the determinants of quota prices. Despite the many quirks inherent in groundfish management, quota prices are affected by fundamentals in reasonable ways: increases in output prices and decreases in quota available both increase quota prices. Increases in monitoring rates also increase quota prices, evidence that at least some of the groundfish fleet is not always compliant with fishing regulations when not observed.
... A larger literature exists for fisheries, reflecting the many instances of market-based management in that domain. These papers have found that rights-based management tends to reduce effort (Hsueh 2017;Costello and Grainger 2018;Isaksen and Richter 2018), distribute effort more evenly across time (Birkenbach et al. 2017), and increase resource levels (Costello et al. 2008), efficiency (Grafton et al. 2011), and revenues (Scheld et al. 2012). 7 For groundwater in particular, Drysdale and Hendricks (2018) and McLaughlin (2020) find reduced water use and higher groundwater levels, respectively, following the introduction of a water market. ...
... For such a policy to be feasible it needed a central authority and involved a supranational management of resources (Holden and Garrod, 1996). Allowing free arbitration of the sector development by national states could lead to discriminatory action and poor enforcement and control. ...
... The individual fisherman thus has an incentive not to exhaust fish resources, not to race to fish (Muro et al., 2009;Brinson and Thunbeg, 2016;Birkenbach, 2017;Hsueh, 2017), and behave in a way that is economically efficient, as well as biologically sustainable. Taking care of future stocks means sustainable yields in the future (Stage et al., 2016). ...
ITQs, Common Fisheries Policy, and stakeholders’ perceptions. Rights Based Management (RBM) schemes have already been experimented with in specific fisheries and locations. The lessons given by these experiences are fundamental to explore the feasibility of such tools and their social, economic, and environmental impacts. In this paper we analyze the possibility of introducing a more focused approach on RBM, in the form of Individual Transferable Quotas (ITQs) in the Common Fisheries Policy. Using Stakeholders Analysis, we analyze and report the different perceptions of the Portuguese stakeholders facing this situation. We conclude that the introduction of ITQs tends to increase market concentration in the sector, triggering serious social problems for locals.
... Refs. [5,6,8,88]]. A meta-analysis of 39 ITQ-managed fisheries in the USA found strong evidence for ITQs extending fishing seasons [88] suggesting fishers did not feel the same pressures to fish hard after ITQ introduction. ...
... [5,6,8,88]]. A meta-analysis of 39 ITQ-managed fisheries in the USA found strong evidence for ITQs extending fishing seasons [88] suggesting fishers did not feel the same pressures to fish hard after ITQ introduction. A study examining the impacts of 15 ITQ programmes in the USA and British Columbia also found that the average season had lengthened from 63 days to 245 days [6] evidence that fishers had spread their fishing effort over a longer time period. ...
Transferable fishing rights in the form of individual transferable catch quota (ITQ) have been introduced into a large number of fisheries worldwide, mainly to achieve resource sustainability objectives and to improve the economic performance of the fisheries. ITQs have been credited with a number of potential benefits, particularly in relation to fisher incentives and allowing the fishery to adjust in response to changing biological and economic conditions without the need of further actions by managers to reduce fishing effort. While these economic benefits have been realised in some fisheries, others have seen less of an improvement in economic performance and believed to have resulted in adverse social impacts in some cases. This article reviews international experiences of ITQ management to determine the experiences elsewhere in relation to sustainability, economic, social, and governance outcomes, collating the empirical evidence for ITQs in achieving multiple objectives, and highlighting the research gaps.
... Despite broad scientific agreement and two recent empirical tests in individual fisheries 17,18 , support for the hypothesis that catch shares end the race comes primarily from qualitative case studies and before-after comparisons 4,[19][20][21] . Unfortunately, quantifying the change in fishing season length in these ways risks confounding correlation and causation. ...
... Our results strongly support the widely held view that catch shares attenuate the race to fish 1,2,4,5,9,11,14,17,19 . Whether fisheries are pooled to estimate an average treatment effect (Table 1) or fishery-specific treatment effects are estimated separately and combined in a meta-analysis (Table 2), catch shares are found to lengthen the season and thus ameliorate the tragedy of the commons. ...
... Given the impracticality of randomized controlled trials in catch share implementation, our quasi-experimental approach to observational data provides the most reliable empirical information available on the season length effects of catch shares. Other rigorous quasi-experimental evidence of season decompression is limited to just two recent studies of selected examples 17,18 . Data. ...
In fisheries, the tragedy of the commons manifests as a competitive race to fish that compresses fishing seasons, resulting in ecological damage, economic waste, and occupational hazards. Catch shares are hypothesized to halt the race by securing each individual's right to a portion of the total catch, but there is evidence for this from selected examples only. Here we systematically analyse natural experiments to test whether catch shares reduce racing in 39 US fisheries. We compare each fishery treated with catch shares to an individually matched control before and after the policy change. We estimate an average policy treatment effect in a pooled model and in a meta-analysis that combines separate estimates for each treatment-control pair. Consistent with the theory that market-based management ends the race to fish, we find strong evidence that catch shares extend fishing seasons. This evidence informs the current debate over expanding the use of market-based regulation to other fisheries.
User rights in fisheries refer to the rights of fishers to harvest from fish resources. In terms of exclusivity, security, duration and transferability these rights can be strong or they can be weak. In recent years there has been a substantial movement toward stronger user rights in many fisheries around the globe and further shifts of the same kind are recommended by many fisheries advisors. The paper argues that a transition from weak to strong user rights in fisheries has a wide range of impacts. In the paper it is attempted to identify and describe some of the more prominent of these impacts. It is found that these impacts may be conveniently divided in economic, environmental and social impacts. Although this classification is by no means perfect or even exhaustive, it is hoped that it can serve as a framework for further research in the field. The paper continues to provide some discussion of the social desirability and undesirability of the various impacts.
