IDEAS home Printed from https://ideas.repec.org/p/eti/dpaper/09046.html
   My bibliography  Save this paper

Efficiency of Individual Transferable Quotas (ITQ) Systems and Input and Stock Controls

Author

Listed:
  • HIGASHIDA Keisaku
  • TAKARADA Yasuhiro

Abstract

This paper examines whether or not the number of fishers is optimal under an Individual Transferable Quotas (ITQ) program. We consider two cases on the structure of the quota market: (1) cases in which all fishers are price takers, and (2) cases in which large-scale fishers have market power. When all fishers are price takers in the quota market, the social optimum is likely to be achieved given the total allowable catch (TAC) level. On the other hand, when low-cost fishers have market power in the quota market, the inefficiency may be serious: excess entry of low-cost fishers and insufficient exit of high-cost fishers may take place. Moreover, we demonstrate that vessel controls and stock targeting may work for an ITQ program.

Suggested Citation

  • HIGASHIDA Keisaku & TAKARADA Yasuhiro, 2009. "Efficiency of Individual Transferable Quotas (ITQ) Systems and Input and Stock Controls," Discussion papers 09046, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:09046
    as

    Download full text from publisher

    File URL: https://www.rieti.go.jp/jp/publications/dp/09e046.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Anderson, Lee G., 1991. "A note on market power in ITQ fisheries," Journal of Environmental Economics and Management, Elsevier, vol. 21(3), pages 291-296, November.
    2. Dale Squires & James Kirkley, 1996. "Individual Transferable Quotes in a Multiproduct Common Property Industry," Canadian Journal of Economics, Canadian Economics Association, vol. 29(2), pages 318-342, May.
    3. Quinn Weninger, 1998. "Assessing Efficiency Gains from Individual Transferable Quotas: An Application to the Mid-Atlantic Surf Clam and Ocean Quahog Fishery," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(4), pages 750-764.
    4. Niels Vestergaard & Frank Jensen & Henning P. Jørgensen, 2005. "Sunk Cost and Entry-Exit Decisions under Individual Transferable Quotas: Why Industry Restructuring Is Delayed," Land Economics, University of Wisconsin Press, vol. 81(3).
    5. Scott C. Matulich & Murat Sever, 1999. "Reconsidering the Initial Allocation of ITQs: The Search for a Pareto-Safe Allocation between Fishing and Processing Sectors," Land Economics, University of Wisconsin Press, vol. 75(2), pages 203-219.
    6. Boyce, John R., 2004. "Instrument choice in a fishery," Journal of Environmental Economics and Management, Elsevier, vol. 47(1), pages 183-206, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zafer Kanik & Serkan Kucuksenel, 2013. "The Promise of Transferable Fishing Concessions on EU Fisheries," ERC Working Papers 1312, ERC - Economic Research Center, Middle East Technical University, revised Dec 2013.
    2. Kanik, Zafer & Kucuksenel, Serkan, 2014. "Transferable Fishing Concessions and EU Fisheries," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 183092, European Association of Agricultural Economists.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. 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.
    2. Quinn Weninger, 2008. "Economic Benefits of Management Reform in the Gulf of Mexico Grouper Fishery: A Semi-parametric Analysis," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 41(4), pages 479-497, December.
    3. Keisaku Higashida & Yasuhiro Takarada, 2011. "On Efficiency of Individual Transferable Quotas (ITQs) through Reduction of Vessels," Discussion Paper Series 68, School of Economics, Kwansei Gakuin University, revised Jan 2011.
    4. Barbara Hutniczak & Niels Vestergaard & Dale Squires, 2019. "Policy Change Anticipation in the Buyback Context," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(1), pages 111-132, May.
    5. Trond Bjørndal & Daniel Gordon & Mintewab Bezabih, 2012. "Measuring potential profits in a bioeconomic model of the mixed demersal fishery in the North Sea," Journal of Bioeconomics, Springer, vol. 14(2), pages 147-166, July.
    6. Kurt E. Schnier & Ronald G. Felthoven, 2013. "Production Efficiency and Exit in Rights-Based Fisheries," Land Economics, University of Wisconsin Press, vol. 89(3), pages 538-557.
    7. Holzer, Jorge & McConnell, Kenneth, 2023. "Extraction rights allocation with liquidity constraints," Resource and Energy Economics, Elsevier, vol. 71(C).
    8. Weninger, Quinn & Waters, James R., 2003. "Economic benefits of management reform in the northern Gulf of Mexico reef fish fishery," Journal of Environmental Economics and Management, Elsevier, vol. 46(2), pages 207-230, September.
    9. Newell, Richard G. & Sanchirico, James N. & Kerr, Suzi, 2005. "Fishing quota markets," Journal of Environmental Economics and Management, Elsevier, vol. 49(3), pages 437-462, May.
    10. Matthew N. Reimer & Joshua K. Abbott & James E. Wilen, 2014. "Unraveling the Multiple Margins of Rent Generation from Individual Transferable Quotas," Land Economics, University of Wisconsin Press, vol. 90(3), pages 538-559.
    11. Tanaka, Kenta & Higashida, Keisaku & Managi, Shunsuke, 2014. "A laboratory assessment of the choice of vessel size under individual transferable quota regimes," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(3), July.
    12. Louis-Pascal Mahé & Carole Ropars, 2001. "L'exploitation régulée d'une ressource renouvelable : inefficacité d'un rationnement factoriel et efficacité des quotas individuels transférables," Économie et Prévision, Programme National Persée, vol. 148(2), pages 141-156.
    13. Okumura, Yasunori, 2016. "Individual transferable quotas in Cournot competition," Economic Modelling, Elsevier, vol. 55(C), pages 315-321.
    14. Andries Richter & Anne Maria Eikeset & Daan Soest & Florian Klaus Diekert & Nils Chr. Stenseth, 2018. "Optimal Management Under Institutional Constraints: Determining a Total Allowable Catch for Different Fleet Segments in the Northeast Arctic Cod Fishery," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 69(4), pages 811-835, April.
    15. Eggert, Håkan & Tveterås, Ragnar, 2004. "Potential Rent and Overcapacity in the Swedish Baltic Sea Trawl Fishery," Working Papers in Economics 152, University of Gothenburg, Department of Economics.
    16. Asche, Frank & Bjørndal, Marianne Tranberg & Bjørndal, Trond, 2014. "Development in fleet fishing capacity in rights based fisheries," Marine Policy, Elsevier, vol. 44(C), pages 166-171.
    17. Keisaku Higashida & Kenta Tanaka & Shunsuke Managi, 2011. "Is the behavior of fishers rational under Individual Transferable Quotas (ITQs) regimes? An Experimental Approach," Discussion Paper Series 73, School of Economics, Kwansei Gakuin University, revised Aug 2011.
    18. Heaps, Terry, 2003. "The effects on welfare of the imposition of individual transferable quotas on a heterogeneous fishing fleet," Journal of Environmental Economics and Management, Elsevier, vol. 46(3), pages 557-576, November.
    19. Sean Pascoe & Phoebe Koundouri & Trond Bjørndal, 2007. "Estimating Targeting Ability in Multi-Species Fisheries: A Primal Multi-Output Distance Function Approach," Land Economics, University of Wisconsin Press, vol. 83(3), pages 382-397.
    20. Christopher M. Anderson & Daniel S. Holland, 2006. "Auctions for Initial Sale of Annual Catch Entitlement," Land Economics, University of Wisconsin Press, vol. 82(3), pages 333-352.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eti:dpaper:09046. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: TANIMOTO, Toko (email available below). General contact details of provider: https://edirc.repec.org/data/rietijp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.