Assigning Property Rights in the Common Pool: Implications of the Prevalence of First-Possession Rules for ITQs in Fisheries
AbstractRights-based institutions have been adopted for certain natural resources in order to more effectively mitigate the losses of the common pool. Past central government regulation has not proved satisfactory. A major issue has been the assignment of those rights. In this paper, I examine three different allocation rules: first-possession, lottery or uniform allocation, and auction and draw predictions as to when they might be adopted. I analyze the assignment, timing, and nature of the rights granted in five resources: oil and gas unit shares, water rights, radio spectrum rights, emission permits, and fishery ITQs. I find that rights-based arrangements generally are adopted late, but when they are implemented, first-possession rules dominate where there are incumbent users. Lotteries and auctions are rarely used. I discuss criticisms of first-possession rules and argue that first-possession is likely more efficient than previously recognized. Accordingly, restrictions on ITQs (rights set-asides for particular groups and exchange limitations) may be costly in the long run for maximizing the value of the fishery resource.
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Bibliographic InfoArticle provided by Marine Resources Foundation in its journal Marine Resource Economics.
Volume (Year): 22 (2007)
Issue (Month): 4 ()
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Web page: http://www.uri.edu/cels/enre/mre/mre.htm
Property rights; ITQs; first possession; Environmental Economics and Policy; International Relations/Trade; K11; L79; N52; Q22;
Find related papers by JEL classification:
- K11 - Law and Economics - - Basic Areas of Law - - - Property Law
- L79 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Other
- N52 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - U.S.; Canada: 1913-
- Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
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