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Part IV. Renewable Resources

A. Fish – part 2: Policy

B. Forests

C. Water

D. Biodiversity

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Current Fishery Policy

• This section will focus on 2 approaches to policy.

1. Those policies that can actually address the issue of entry are termed “limited-entry” techniques.

2. All other regulations or policies that do not explicitly address the problem of entry are termed “open-access” (OA) techniques.

• OA techniques modify fishing behavior of those participants in the fishery without directly affecting participation in the fishery, and typically raise the cost associated with fishing.

• Analogous to C & C

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OA regulations – how to catch

• OA regulations are designed to maintain the stocks at some target level, usually stocks consistent with MSY.

• Because modern technology can give a fishing fleet tremendous fishing power relative to the size of a fish population, OA regulation generally forces inefficiency on the fishers.

• In Maryland's share of the Chesapeake, it is illegal to dredge for oysters under motorized power. This means sails, smaller dredging equipment, and slower movement across the oyster beds.

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OA regulations – who to catch

• Regulation which revolves around restrictions on the minimum size of fish that are legal to harvest are designed to leave a portion of the fish stock in the water to provide a sufficient breeding stock to ensure future populations.

• Fishers generally implement this restriction by choosing a mesh size for their nets that allows smaller, illegal fish, to escape.

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OA regulations – when to catch

• Because fishing activity may disrupt the spawning process, often the fishing season is closed for a certain period on an annual basis, generally during spawning season.

• Also, some species become so extremely congregated during spawning that fishing effort could capture virtually the entire population.

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OA regulations – where to catch

• Regulations on where fish may be caught are designed to protect fish stocks when they are congregated and vulnerable to overharvesting.

• These types of regulations also protect vulnerable

fishing habitats from destruction by the fishing process.

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OA regulations – how many to catch

• Often, OA regulations take the form of limits on how many fish may be captured in a given time period.

• These limits may be in the form of weight caught, number of fish, or volume of catch.

• The catch limit on giant bluefin tuna is 1 fish per boat. A fish can often weigh as much as 1000 pounds and the market price has been $18 per pound.

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Economic Analysis of Open-Access Regulations

• The effect of OA regulation falls has 2 effects: 1. increase in cost due to regulations 2. possible decrease in cost due to higher catch per effort

expended.

• Net effect increased costs

• Table 11.3 summarizes the impact of the OA regulations on key variables in the fishery.

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Economic Analysis of Open-Access Regulations

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Limited Entry Techniques

• Limited entry techniques raise the cost for fishers without increasing social costs.

• If limited entry techniques are truly analogous to economic incentives for pollution control, then they should be available either as price policies (tax) or quantity policies (MPP).

• Fisheries economics literature tends to focus on quantity-based systems.

• The name for these systems is individual transferable quotas (ITQs).

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Catch based ITQs

• ITQs would work in a fashion similar to marketable pollution permits.

• Limit placed on total catch, each fisher allocated portion of total catch

• Limits effort because cost of effort increases, because people must now buy ITQs to fish

• Cost increase serves to eliminate disparity between social and private cost of fishing associated with the OA externality

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Effort based ITQs

• Limited entry techniques structured to direct effort rather than catch can also be developed.

• Here only a fixed number of boats would be allowed to operate in the fishery, must have permit be to allowed in

• The method of permit allocation could be by auction or historical presence in the fishery.

• Completely analogous to MPP’s

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Transferable ITQs

• If these ITQs are transferable, it will be possible to have only the most efficient fisherman in the fishery.

• Enforcement of effort-based limits, that is vessel permits, would be much easier than that associated with the catch limits.

• No measuring or weighing is necessary; a poster sized certificate of operation would allow easy identification of legal vessels.

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ITQ problems

• Catch-based ITQs are subject to several problems. • People might cheat on their quota by selling to

foreign vessels or in an underground market.

• Another problem is associated with the differing market values of different size fish.

• Once quota is reached, throw less valuable (but now dead) fish overboard to make room for better catch

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Private oyster beds

• Although most fishery regulation relies on OA techniques, an important example of a limited entry technique is the Virginia oyster fishery, where oyster beds are treated as private property.

• Eliminates OA exploitation

• It gives oyster bed operators incentive to invest in their property such as seeding with larval oysters and creating more structures to which the oysters can attach.

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EEZ

• An additional example of the limited entry regulation is the economic exclusion zone, established under the authority of the United Nations Convention of the Law of the Sea.

• This regulation established a 200 mile limit along the coast of a country where each country has the right to limit access to their waters. This is a partial limited access regulation.

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Why We Do Not See More Limits to Entry

• First, many limits to access are informal.

• Fishing communities tend to be close knit and generally resistant to outsiders.

• It is difficult to enter into these fisheries without facing barriers and possible sabotage of equipment.

• Second, fisherman opposition to the idea of limited entry is high.

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Why We Do Not See More Limits to Entry

• A possible explanation for the opposition to limited entry among current fishers is that these fishers may be utility maximizers rather than profit maximizers.

• Pure profit maximizers would see the potential economic rents associated with limited entry, and most would probably support limits to entry in order to obtain these potential rents.

• Fishers from communities that have fished for generations fit this category.

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Why We Do Not See More Limits to Entry

• Need to reduce catch today in order to expand fish stock, catch and income in the future.

• The desire to support fishing families in the present may result in opposition of limited entry policies.

• The greater the uncertainty about the success of limited entry policies to enhance future value in the fishery, the greater the chance fishers will not support the policies.

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Aquaculture• Aquaculture, the cultivation of fish in artificial

environments or in contained natural environments, is often suggested as a means of dealing with the OA problem.

• Not all species can be cultivated.

• Shellfish are ideal because of their inherent immobility.

• Wildfish will only benefit indirectly from aquaculture if the “farmed” species takes part of the market demand for the wildfish and therefore reduces the fishing pressure on the species.

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Aquaculture’s problems

• Aquaculture creates its own set of problems.

• Communities and industries that are based on wild fisheries could suffer economic setbacks from the decline in demand for wild fish (as consumers choose aquaculture).

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Aquaculture’s problems

• Aquaculture can severely damage the environment.

• Shrimp aquaculture in Central and South America has resulted in a loss of mangrove forests, excess nutrient loading into estuaries and severely reduced dissolved oxygen in areas bordering estuaries.

• There are also potential problems associated with hybridized fish escaping and damaging the gene pool of existing species.

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Other Issues in Fishery Management

• Other problems associated with fishery management include:

– incidental catch; – destruction of habitat through fishing activities; – destruction of wetlands and related habitat through non-

fishing activities; – pollution of fishery habitat; – conflicts between user groups and – international cooperation concerning the harvesting of

migratory species.

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Incidental catch

• Often the fisher will catch not only the species that they seek but also other species, referred to as incidental catch.

• Many types of fishing gear do not discriminate among fish species, and both the desired species and a spectrum of untargeted species are caught by this gear.

• Among the most notorious of these are the gill nets, whose lengths often measured in miles.

• These nets are vertically suspended in the water, like underwater fences, ensnaring the gill covers of fish as they attempt to back out.

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Long Lines

• Another indiscriminate fishing method is “long-lining.”

• A long-line consists of line that may be 10 km in length or longer, with baited hooks every several meters.

• These lines are employed off the Atlantic coast in pursuit of highly profitable swordfish.

• Because sharks are often caught, these long-lines have been an important factor in the decline of the shark populations.

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Policy

• Due to the difficulties of monitoring, restrictions on fishing methods may be preferential to policies based on economic incentives.

• An example of this type of policy is the requirement that shrimpers install a Turtle Excluder Device (TED) in their nets to allow endangered sea turtles to escape.

• In addition to the turtles which are “kicked” out of the shrimp net, non-targeted fish are also allowed to escape.

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Policy

• Whether policy makers should implement the restrictions on gill nets and long-line operations needs to be determined on a case-by-case basis for each potential restriction.

• The benefits of protecting untargeted species are spread out over a large number of people, but the costs are concentrated upon a very few.

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Destruction of Habitat

• Damage can occur when contact of fishing gear with the floor of the estuary or ocean uproots aquatic plants, breaks coral, dislodges shell fish, and so on.

• One particularly sensitive ecosystem is that associated with a coral reef, where anchors and boat bottoms dragging across the coral can kill it.

• Even more destructive is the practice of fishing using

explosions or the use of cyanide in the coral to stun and collect fish for consumption and aquariums.

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Destruction of Habitat

• Other habitats such as upland and coastal wetlands, temperate forests and free flowing rivers are critically important to fisheries.

• The temperate rainforests of the Pacific Northwest are critically important to maintaining the riverine habitat, which is essential to anadromous fish, such as salmon and steelhead.

• Any activity which impacts the quality of these ecosystems can impact the quality of the riverine system and the salmon and steelhead.

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Pollution of Fishery Habitat

• This pollution and loss of habitat has affected virtually every freshwater species, and many saltwater species, where saltwater species are affected by estuarine pollution.

• Anadromous species such as salmon, steelhead, shad, and striped bass are particularly vulnerable to riverine pollution.

• In developing countries, soil erosion from deforestation and intensive cultivation of hillside lands has severely impacted water quality not only in the rivers, but in reservoirs, estuaries, lagoons, and coral reefs.

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Management of Recreational Fishery Resources

• Limits on the number of fish that may be kept, restricted seasons, and size limits.

• By stocking fish, where a very large number of fish are hatched, grown to size, and released into the wild, the problem of OA is addressed by increasing resource base.

• Often have closed seasons timed to coincide with spawning periods in the fishery.

• Access improvements such as launching ramps, fishing piers, parking areas, and artificial reefs can be designed to reduce congestion in the fishery, but may also lead to increased use.

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Management of Recreational Fishery Resources

• Catch & release programs are based on the idea that a recreational angler does not have to kill his or her catch to produce utility from fishing.

• Size limits place restrictions on the minimum (and sometimes maximum) size of fish that are legal to keep.

• Creel limits place restrictions on the maximum number of fish per day that may be kept.

• Both restrictions are designed to protect the reproductive viability of the fish stocks.

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Management of Recreational Fishery Resources

• In order to find the benefits associated with a particular recreational fishing activity, a valuation study must be done. Usually CV or travel cost studies.

• Freeman (1979) and many others note that the major benefit of improving water quality can be attributed to recreational uses of water resources, including boating, swimming, and recreational fishing.

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Summary

• Fishery resources are renewable but destructible.

• The destructibility problem is amplified by the open-access nature of many of the world’s fishery resources.

• For commercial fishing, optimal management strategy requires the limitation of effort to a level that maximizes the sum of CS, PS, and fishery rent.

• Actual fishery management seldom achieves this goal and is based on developing restrictions on how, when, where, and how much fish can be caught.