0.19 Natural capital: fisheries  (Page 3/14)

Dealing with fisheries issues: salt water fisheries

We first discuss issues in saltwater fisheries, the most important source of fish. A later sector deals with issues in Freshwater Fisheries.

As is the case for conservation of other forms of natural capital (energy, water, forests) sensible approach requires a portfolio of policies. No panaceas are available. We will first examine some market-based measures.

Itqs individual transferable fishing quotas: a market-based approach

Many economists and ecologists believe strongly that innovation in property rights can halt or even reverse trends toward collapsing fisheries. See Science, September 20, 2008. Under ITQs, instead of exhortation by politicians, incentives for conservation of fisheries are provided. Fishers are granted shares in the allowable catch (defined usually as some percentage of last year’s catch). ITQs are common in Iceland and for Halibut and Salmon in Alaska. Notably, a series of articles in Science magazine, the Economist and others have shown that ITQ managed fisheries are sufficiently less prone to collapse then non-ITQ fisheries.

How do ITQs work?

One first establishes a seasonal or annual quota for the type of fish being caught. The quotas are a percent of the total annual (or seasonal) allowable catch (TAC) (to be discussed in detail below). Briefly, the allowable catch is determined by Ichthyologists and other marine specialists. The allowable catch for any given region can vary from year to year, depending on estimates of the health of the fish stocks.

Then each fisher is allowed a certain number of ITQs. The fisher can use the ITQ, or he can sell it to others, who can harvest the fish at any time during the fishing season. In this way boat captains can plan the season’s fishing without worrying about weather. And more importantly, the captains need not worry the risk that other fishers will gobble up the common property resource. The latter is called race-to-fish. This is what tends to happen if instead of ITQs an effort is made to regulate the catch by banning fishing except for very short seasons (say a one-week season). In this situation, captains tend to fish day and night surrounded by dozens of boats also trying desperately to catch enough before the short season expires.

How do typical ITQ systems work? Iceland experienced a collapse in many fish stocks in 1969-74. ITQs were Iceland’s response. All ITQ systems (Iceland, New Zealand, and Alaska) began with the establishment of the TAC - Total Allowable Catch. The TAC is an estimate by fish biologists. It takes into account the estimated stock, the lifetime of the fish species, and the amount of fish that can be withdrawn from the stock and still allow sustainable fishing. (Sustainable fishing: fishing that does not diminish the size of the stock for future generations).

The TAC is expressed as a fixed % (20-25%) of the total stock. In the next step, the authorities sell a certain percentage of the TAC to fishers as a long-term “individual transferable quota (ITQ).” The ITQ is transferable. It may be used by the fishermen awarded the ITQ, or he/she can sell it. This ensures that fishermen pay according to the amount they catch and gives fishermen an interest in the future of the resource. It also materially mitigates the highly destructive “race to fish” found in older regulatory system (3 day seasons, etc.)