Closing the Incentive Gap: The Role of Public and Private Actors in Governing Indonesia's Tuna Fisheries

• Published in: Journal of environmental policy & planning 2016-03, Vol.18 (2), p.141-160
• Main Authors: Bailey, Megan, Miller, Alice M.M., Bush, Simon R., van Zwieten, Paul A.M., Wiryawan, Budy
• Format: Article
• Language: English
• Subjects: Aquaculture and Fisheries; Aquacultuur en Visserij; Asymmetry; Developing countries; double principal-agent problem; Environmental Policy; Fish; Fisheries; Fisheries management; Fishermen; Governance; Government regulations; incentive gap; incentive-based management; Incentives; Indonesia; LDCs; Leerstoelgroep Aquacultuur en Visserij; Leerstoelgroep Milieubeleid; Marine; Milieubeleid; Monetary incentives; Moral hazard; Oversight; Private sector; Public administration; Public sector; public-private; Regulation; Resource management; Stocks; Thunnus; Tuna; tuna fisheries; WASS; WIAS
• ISSN: 1522-7200; 1523-908X; 1522-7200
• DOI: 10.1080/1523908X.2015.1063042

Indonesia is one of the world's largest tuna producing countries, yet regulatory oversight remains weak and management is poor. Incentive-based approaches are a way to improve state-based resource management, but they often require strong government regulation. In this paper, we use principal–agent theory and the notion of the ‘incentive gap’ to explore how incentives could be brought to bear in Indonesia through a combination of private and public actors. With a shared fish stock like tuna, we argue that a double principal–agent problem emerges, where information, asymmetries between various players complicate management. We focus on the problems of adverse selection and moral hazard in three different tuna fisheries in Indonesia to identify the nature of the incentive gap, and comment on the mix of public and private actors currently engaged in tuna fishery governance towards reducing the gap. The double principal–agent problem is a useful yet underutilized framework to understand the dynamics of shared stocks management. In this first application to a developing country fishery, we conclude that information asymmetries cannot be overcome without the involvement of private actors, who are increasingly becoming important in aligning regional and global objectives with those of fishers themselves.