Open AccessFISHERY SHARE SYSTEMS, ITQ MARKETS, AND THE DISTRIBUTION OF RENTS
Author(s) -
HATCHER AARON
Publication year - 2014
Publication title -
natural resource modeling
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.28
H-Index - 32
eISSN - 1939-7445
pISSN - 0890-8575
DOI - 10.1111/nrm.12023
Subject(s) - allocative efficiency , economic rent , business , profit (economics) , market share , earnings , equity (law) , economics , industrial organization , microeconomics , finance , political science , law
Although, in most commercial fisheries, fishing crews are remunerated under a share system, the implications of share systems for individual transferable quotas markets have received relatively little attention. In this paper, we model the impact of extending crew shares of vessel operating costs to include payments for quota. Allocative efficiency is maintained as long as any share system is adopted consistently across the entire fleet. Making crews bear a share of quota costs, however, simply inflates the quota price: at market equilibrium the vessel owner's profit share is unaffected. Crews lose out if the vessel is leasing quota in, but gain if the vessel owner is a net seller of quota. We also consider the outcome if only net purchasers of quota involve crews in the cost of quota. Here, all vessel owners benefit, while all crews see a reduction in their earnings. These results are illustrated with a simple numerical example.