Aquaculture for all

Are Property Rights Key to Saving U.S. Fisheries?

Economics Politics +2 more

US - A recent report by the United Nations Environment Programme finds that 25 per cent of all fisheries are collapsing because of overfishing. (A fishery is considered collapsed if its annual catch is less than 10 per cent of its historical maximum catch.)

While the current state of fisheries sounds alarming, future forecasts look worse. A 2006 article published in Science predicts that by 2048, all fish stocks worldwide will be gone if historical trends continue. The conditions of United States fisheries fare just as poorly.

The data in the chart above defines a fishery as a fish species in a specific region, such as skipjack tuna off the central west coast of the United States. The chart shows that a growing number of U.S. fisheries are collapsing. Because most American fisheries are open access, fishermen have little incentive to conserve and often fiercely compete to attain a dwindling yield. Unless policy changes are made, U.S. fish stocks look to be headed for disaster.

Fishery authorities have responded to rapid stock declines by enacting limits on when and where fishing can take place. These regulations have failed. Fishermen with less time to fish have an incentive to purchase more expensive gear and harvest an enormous amount in a short time in order to generate their yearly revenue. The sudden removal of the stock devastates fish populations.

A new policy that has garnered wide acclaim among fisherman, economists, and biologists is enacting a cap-and-trade system for fisheries. When the system begins, an oversight committee (generally composed of scientists, field biologists, and local fishery managers) sets a total allowable catch (TAC) for annual removal. The committee then gives fishermen individual transferrable quotas (ITQs) that represent a share of the allowable catch. Fishermen can then trade, buy or sell these shares, or harvest a catch represented by the total quotas they hold.

By assigning clear property rights, this system could ultimately solve the fisheries problem. Those that own ITQs have a vested interest in husbanding the species of fish that they have the right to harvest. And since the policy assures that no one else will take their share – because those that do not hold ITQs cannot harvest the fish – the pressure to race to harvest is eliminated.

For ITQs to work, there must be both international agreement on the availability of fish stocks to foreign nations and a strict monitoring system. Without an international agreement, foreign vessels could disregard and ultimately undermine the domestic ITQ system. Fortunately, more than 90 per cent of fishers operate within 200 miles of their coastline. This puts them under the protection of the Law of the Sea Treaty, an international agreement signed by most countries that dictates that nations own the economic benefits of the sea up to this limit.

With ITQs, satellites monitor fishermen to ensure that they adhere to the cap and trade system. In the European Union, for example, fish vessel location, catch on entry, weekly catch, port of landing, days at sea, and catch on exit are tracked by satellite systems. In essence, the policy and technology already exist to maintain the success of ITQs.

A 2008 study published in Science by Dr. Robert Costello and coauthors found that fisheries that enact ITQs immediately reduce the probability of collapse by 14 per cent. The policy continues to reduce the probability of collapse by 1 per cent each year after. The study also found that in the most recent year of available data, the proportion of collapsed fisheries among those with ITQs was half of those without ITQs.

There are currently 12 cap-and-trade fishery programs in the United States, many of which are young (five have been enacted since 2005). These constitute less than 2 per cent of all U.S. fisheries. It is not surprising, then, that we continue to see the dramatic increase in collapsing American fish stocks. The U.S. government, however, has responded to the new documented success of ITQs by increasing federal spending on fisheries cap-and-trade policy. In June the House of Representatives approved an $18.6 million National Oceanic Atmospheric Association (NOAA) spending bill devoted toward ITQ implementation. In addition, the NOAA created a catch share task force to help increase ITQ management programs.

Both actions will increase the prevalence of property management programs for American fisheries. The next few decades will determine whether they are enough to halt and possibly reverse the trend of collapsing fisheries in the U.S.

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