Evaluating efficiency gains from adopting property rights-based fisheries management is data intensive, complicated by delays in adjusting to economic incentives implicit in output control regulations, and potentially confounded by the effects of changing stock abundance and other fundamentals. This paper evaluates harvesting efficiency for the universe of vessel participants in the West Coast groundfish trawl fishery two years prior to and six years following introduction of individual fishing quota (IFQ) regulations. Our methods control for delayed fleet restructuring and confounding effects of changing groundfish stock abundance. We find that under IFQs, redundant vessel capital exited the groundfish fishery at a rate of 5.77% per year, and resource rent increased at a rate of 6.02% per year. Annual resource rent is estimated at $31.26 million at six years of IFQ regulation, with additional gains pending due to continued fleet restructuring. Our results suggest that the efficiency gains from reversing the tragedy of the commons in fisheries can take years to materialize and may be substantially larger than acknowledged in earlier literature.
Q22, L25, L51
Original Release Date: August 20, 2019
Department of Economics, Iowa State University
Evans, Keith S.; Lian, Carl; and Weninger, Quinn, "Property rights and the efficient extraction of common pool resources: evidence from west coast groundfish" (2019). Economics Working Papers: Department of Economics, Iowa State University. 19011.