Northwest Fisheries Science Center

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Document Type: Chapter or Section
Center: NWFSC
Document ID: 4530
Type of Book: Technical
Section or Chapter Title: Structuring Rights and Privileges in Catch Share Systems
Book Title: Handbook on the Economics of Natural Resources
Author: Daniel S. Holland
Editor: David F. Layton, Robert Halvorsen (Eds.)
Publication Year: 2015
City: UK
Publisher: Edward Elgar Publishing
Keywords: Individual Fishing Quota,Individual Quotas,cooperatives
Abstract:

The absence of property rights leads to dissipation of resource rents in fisheries. Economists have long recommended the assignment of property rights to the fishery primarily as a means to internalize the stock externalities that lead to rent dissipation. This recommendation has been operationalized in a growing number of fisheries now managed with “catch share” systems that create ongoing entitlements to a share of the sustainable yield from a fishery.  The structure of these entitlements varies greatly across fisheries in terms of how they are defined and how they can be used and transferred. In most cases these entitlements are not legally considered property rights (and can be revoked without compensation) though they function like property rights, if weak ones, nonetheless. While strong property rights with a long duration and few constraints on use and transferability might be expected to maximize efficiency the designers of catch share systems often consider a number of other objectives, some of which may conflict directly with efficiency. In some cases constraints on use may be needed to address residual externalities not resolved by a standard individual quota system and could therefore be welfare increasing.  In this chapter I compare the structure of rights in a number of different catch share systems and discuss why various constraints on rights are included, what objectives they are designed to achieve, and the impacts, intended and otherwise, they have on outcomes including but not limited to efficiency.