Assessing Efficiency Gains from Individual Transferable Quotas: An Application to the Mid‐Atlantic Surf Clam and Ocean Quahog Fishery

Abstract

Delayed fishing fleet restructuring complicates the assessment of efficiency gains from individual transferable quota (ITQ) fisheries management programs. This article presents a methodology to estimate harvest sector efficiency gains in lieu of incomplete fleet restructuring. The methodology is applied to assess the efficiency gains in the Mid-Atlantic surf clam and ocean quahog fishery ITQ program. While roughly 128 vessels harvested clams under the previous management regime, the analysis suggests that 21–25 vessels will remain under lTQs. The efficiency gains are estimated to be between $11.1 million and $12.8 million annually (1990 dollars). Copyright 1998, Oxford University Press.

Distributional effects of property rights: Transitions in the Atlantic Herring fishery

“…Economic models show that in fisheries with harvest restrictions and without restrictions on entry, an unbounded number of boats chase a fixed number of fish, promoting inefficiencies and overcapitalization in the fishery [5,6]. Empirical evidence from existing ITQ programs suggests that property rights systems can reduce the level of excess capital employed in the fishery [7][8][9]. For a review of the empirical literature, see [10].…”

“…The set also contains a number of vessel characteristics including gross registered tonnage, vessel length, engine horsepower, owner information, and capacity measures. 8 We chose to annualize the trip data in order to dampen the effects of large, short-term fluctuations in harvest, thus allowing for a ''smoother'' production function. Missing (or questionable) entries were verified and completed, when available, using the US National Coast Guard Database.…”

“…7 The half normal distribution is the absolute value of a normally distributed variable. 8 We chose vessel weight over vessel length as the measure of capital stock. Horsepower was highly correlated with both measures so it was excluded from the analysis.…”

“…By issuing defined property rights, ITQs should result in an increase in economic efficiency [7][8][9]24]. These gains, at least in theory, are realized for two reasons.…”

“…Due to a lack of cost data, our analysis focuses on management impacts on technical inefficiencies. We proceed under the assumption that the most technically efficient boats will also be the most cost effective-an assumption in keeping with the previous economic literature evaluating gains from ITQs [8,25]. For our study, this assumption is reasonable because we consider capital to be fixed in the short run, while vessels are choosing a single variable input (days fishing).…”