The Effects of ITQ Management on Fishermen’s Welfare When the Processing Sector is Imperfectly Competitive
AbstractIn this paper we use a general model of imperfect competition to predict welfare changes within an open-access fishery transitioning to individual transferable quota (ITQ) management. Although related research has explored the effects of market power in the harvesting sector on ITQ performance, none have considered the implications of an imperfectly competitive processing sector. This study addresses this question specifically in the context of the Atlantic herring fishery, although its implications are relevant to all fisheries with similar industry structure. Our results show that ITQs could have a negative impact on fishermen’s welfare when processors have market power and the cap on aggregate harvest is binding or becomes binding with the implementation of ITQs.
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Bibliographic InfoPaper provided by University of Massachusetts Amherst, Department of Resource Economics in its series Working Papers with number 2007-3.
Length: 47 pages
Date of creation: Mar 2007
Date of revision:
ITQ; imperfect competition; welfare analysis; fisheries;
Other versions of this item:
- David M. McEvoy & Sylvia Brandt & Sven Anders, 2009. "The Effects of ITQ Management on Fishermen’s Welfare When the Processing Sector Is Imperfectly Competitive," Land Economics, University of Wisconsin Press, vol. 85(3), pages 470-484.
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-AGR-2007-03-31 (Agricultural Economics)
- NEP-ALL-2007-03-31 (All new papers)
- NEP-COM-2007-03-31 (Industrial Competition)
- NEP-ENV-2007-03-31 (Environmental Economics)
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