While dramatic stories of thedepletion of the world’s fish stocks frequently grab the spotlight in the popular press, reports of the death of fishing have been exagggerated. Stock of some species of fish, however, have been seriously depleted and others are certainly in danger due to poor management regimes around the world. As long as fishery managers and policy makers fail to recognize just why these problems exist, both fish stocks and the people who depend on them will suffer.
Unfortunately, examples of successful fisheries conservation are frequently overlooked, and any institutional analysis of fisheries management around the world is rare. It is instructive, therefore, to examine the means by which individuals can be encouraged to manage marine resources sustainably, in particular within the framework of the economics of property rights.
In the absence of any private rights to marine resources, there is little if any incentive to conserve resources and fisheries suffer. When any fish left in the sea are likely to simply wind up in someone else’s net, conservation measures are frequently ignored and difficult to enforce. The Common Fisheries Policy of the European Union is one of the most egregious examples of management gone wrong – fishing quotas are allocated politically and rarely reduced, even in the face of irrefutable declines in fish stocks. There is also a burgeoning market for illegally caught fish and inadvertently caught fish are commonly caught and discarded, likely dead.
On the other hand, where fishers are able to collectively determine overall catches for themselves, they have strong incentives to ensure that their harvests are sustainable and that their limits are enforced. Limiting access and allowing the private ownership of fishery resources, or at least some sense of it, is the surest way to ensure the long-term health of a fishery. Thus, the institutional arrangements – that is, the set of rules that govern a fishery – are the single most important indicators of the health of fish stocks around the world. The closer these institutional arrangements resemble private property rights, held either in common or individually, the better off a fishery tends to be. This holds true from communal arrangements among villagers in the South Pacific to capital-intensive, deep-sea fisheries in New Zealand.
Allowing groups or individuals to own resources in the oceans is the ideal solution, but in cases where this is not a feasible reform, privatizing access rights has also proven effective. One such exclusive access right is the Individual Transferable Quota (ITQ), a transferable right to harvest fish. New Zealand is particularly noteworthy for its experiment with ITQs, which has transformed fishing there by creating incentives to demand more sustainable catch levels and by reducing incentives for political wrangling over resources.
ITQ systems are not free-market solutions, but they have improved fisheries management in many cases by successfully introducing market mechanisms that encourage conservation. In spite of their flaws, ITQs are a step in the right direction, and in the case of New Zealand, have even started to evolve into real private property rights.
Exclusive ownership rights to resources also create incentives to develop and use technology both to protect resources and to increase their production. Stronger rights create stronger incentives for conservation and stewardship. For example, in Japan, fishery cooperatives own rights to fish in coastal waters. They not only conserve and protect their resources but strive to enhance their fisheries by sinking artificial reefs that both attract and propagate species.
A pragmatic reform, not only in Europe but in the United States and Canada, would be to follow the New Zealand model; to introduce a system of ITQs and allow the owners of ITQs to collectively set appropriate catch levels and to otherwise begin to manage the fishery themselves.