Ocean fisheries: Common heritage or tragic commons

March 14, 2007

Free Market Foundation

American and world fisheries have entered a period of rapid and unprecedented decline. To halt the slide, government should treat fish the same way it treats livestock as private property, says H. Sterling Burnett, a senior fellow with the National Center for Policy Analysis.

Privatisation of marine resources has worked where it has been tried. One of the most popular approaches is creating tradable rights, or individual transferable quotas (ITQs), which entitle fishermen to a certain portion of the catch, often based on their past catch amounts. They can take or trade their quota, up to a government-set total allowable cap on the fish catch. For example:

After introducing ITQs to Iceland’s herring fisheries, the number of fishing vessels fell from 200 in 1980 to 30 by 1995; catches have fallen to sustainable levels, even as their value has risen dramatically.

In 1984, Australia’s blue fin tuna fisheries were near collapse; today they are the most profitable tuna fisheries in the Pacific, and property rights are used to manage 15 species.

In 1986, New Zealand introduced ITQs to manage 30 species of fish, including blue fin tuna, abalone and lobster, each of which has recovered from near collapse.

The United States extended property rights to Atlantic blue fin tuna, mid-Atlantic surf clams, Alaskan halibut and sablefish, and South Atlantic wreckfish; all four fisheries now have smaller fishing fleets, higher incomes for fishermen and larger, healthier fish stocks.

When fishermen no longer have perverse incentives to deplete fish stocks, experience shows populations should rebound. Fisheries must no longer be seen as a commons to be plundered in a “race to fish,” but rather as property to be conserved, enhanced and protected, says Burnett.

Source: H. Sterling Burnett, Ocean Fisheries: Common Heritage or Tragic Commons? National Center for Policy Analysis, Brief Analysis No. 581, February 27, 2007.

For text: http://www.ncpa.org/pub/ba/ba581/

For more on Privatizing Environmental Goods: http://eteam.ncpa.org/issues/?c=privatizing-environmental-goods

For more on Environment Issues: http://www.ncpa.org/sub/dpd/index.php?Article_Category=31

FMF Policy Bulletin/ 06 March 2007