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Ragnar Arnason Community Fisheries Management What structure and why? Fame workshop on New Developments in Rights-based

Ragnar Arnason Community Fisheries Management What structure and why? Fame workshop on New Developments in Rights-based Fisheries Management Esbjerg, August 30-31 2005. Subject of this lecture.

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Ragnar Arnason Community Fisheries Management What structure and why? Fame workshop on New Developments in Rights-based

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  1. Ragnar Arnason Community Fisheries Management What structure and why? Fame workshop on New Developments in Rights-based Fisheries Management Esbjerg, August 30-31 2005

  2. Subject of this lecture Explore the conditions under which community fishing rights will lead to economically efficient fisheries management

  3. I. Background

  4. Fisheries are subject to well known problems of economic inefficiency Fisheries management is needed • Research has determined two classes of management methods that can work (i) Property rights regimes (widely applied) (ii) Taxes (apparently not been applied)

  5. Key Property Rights Systems • Sole ownership • TURFs • IQs and ITQs • Community rights Note: First three are individual rights but the fourth is a collective right

  6. So, basically, individual property rights work! Experience • Sole ownership is extremely rare – but works! • TURFs more common - work! • IQs fairly common - work to a degree • ITQs becoming increasingly common (over 10% of the global catch is taken under ITQs) - work!

  7. Unfortunately:Individual property rights cannot be applied to all fisheries • Sole ownership • Socio-political problems • TURFs • Technical problems (exclusivity) • ITQs • Technical problems (enforcement) • Socio-political problems

  8. Therefore attention has been drawn tocollective property rights in particular..... Community fishing rights

  9. What arecommunity fishing rights? • Fishing rights granted collectively to a group of agents • These rights constitute a property right • It gives the group the authority to • Defend these rights against outsiders • Conduct internal fisheries management Note: Community fishing rights do not constitute a fisheries management system

  10. Rationale • Enhances economic efficiency in fishing • Fisheries management • Enforcement • Socio-politically more appropriate • More in accordance with tradition - natural • More fair - communities can control their own destiny • Politically expedient • Relieves the government of a difficult problem Here only concerned with rationale no. 1

  11. Why should community fishing rights promote efficiency? • In fisheries management • Better information • More appropriate incentives • In fisheries enforcement • Better information • More appropriate incentives • More powerful sanctions

  12. Experience with community fisheries management • Empirical: • Not much evidence • Primarily anthropological and social evidence (not very hard data) • Mixed outcomes – some fairly good, some worse (Note: Tend not to observe the really bad ones) • Experimental • Mixed outcomes

  13. So: Outcomes of community fisheries management seem to depend very much on the particular situation Crucial to adopt the appropriate community design !

  14. II. Design Principles Conditions that contribute to efficient community fisheries management

  15. High quality property right • Security • Exclusivity • Permanence • Transferability Property rights attributes [0,1] High quality  Each attribute close to 1

  16. Exclusivity Security Permanence Actual property right Perfect property right Transferability Perfect and actual property rights

  17. Theorem(not proven in the paper) The lower the value of the property right the less efficient is the associated economic activity Community property rights should be as high quality as possible!

  18. Inclusive membership (I.e. no-one can operate outside the community rules) This means: • No outsiders at the beginning • No-one can leave to become an independent operator in the fishery

  19. Theorem If community management is successful, individual fishers will benefit from leaving - provided they can do so with impunity Fisheries communities should be inclusive

  20. Homogeneous membership Theorem If fishing community members are not identical, bargaining will not lead to the most efficient fishery - unless (perhaps) benefits are transferable

  21. This implies: • The composition of the fisheries community should be as homogeneous as possible • I should only include fishermen – not other professions or interests • It should preferably only include owners of fishing capital – not fishing labour

  22. Pay-offs as shares • Theorem • If fishing community members receive benefits that are increasing in aggregate benefits • (1) The bargaining solution is efficient! (2) The competitive solution is efficient!

  23. This suggests If at all possible, the fishing community should be set up so that each member’s benefits are an increasing function of aggregate benefits Note (1) Limited companies have this property (2) Within-community ITQs have this propety

  24. Fishing CommunityPractical design guidance- Summary - • The community rights should be as high quality as possible • The community should be inclusive – i.e. include all fishers in the area • The community should have as homgeneous membership as possible • Each membes pay-off should be increasing in the aggregate pay-off

  25. End

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