Ex-vessel pricing and IFQs: a strategic approach

In this article, intraseasonal fishing is modeled as a differential game between fishers in a total allowable catch (TAC)--regulated fishery with and without individual fishing quotas (IFQs). Heterogeneous harvest values are included by incorporating time-specific harvest costs and a cumulative-harv...

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Bibliographic Details
Published in:Marine resource economics 2010-01, Vol.24 (4), p.311
Main Author: Fell, Harrison
Format: Article
Language:English
Subjects:
Economic aspects
Fish industry
Fisheries
Genetic algorithms
Online Access:Get full text
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Summary:In this article, intraseasonal fishing is modeled as a differential game between fishers in a total allowable catch (TAC)--regulated fishery with and without individual fishing quotas (IFQs). Heterogeneous harvest values are included by incorporating time-specific harvest costs and a cumulative-harvest effect into fishers' profit functions. I also allow for strategic interaction among fishers via ex-vessel price dynamics. The equilibrium harvest strategies of the differential games are solved numerically through the use of a genetic algorithm. It is demonstrated how different harvesting sector environments lead to varying degrees of ex-vessel price increases when IFQs are implemented. The primary result shows that possible margins for competition amongfishers, other than competition for a greater share of the TAC, can exist even under IFQ management and this competition, especially when combined with noncompetitive processors, may be substantial enough to prevent sizeable rent transfers from the processing sector to the harvesting sector. Key words Individual fishing quotas, property rights, differential games, genetic algorithm. JEL Classification Codes Q22, C73, C61.
ISSN:0738-1360