IDEAS home Printed from https://ideas.repec.org/a/eee/ecomod/v265y2013icp230-238.html
   My bibliography  Save this article

Fluctuating quota and management costs under multiannual adjustment of fish quota

Author

Listed:
  • van Dijk, Diana
  • Haijema, Rene
  • Hendrix, Eligius M.T.
  • Groeneveld, Rolf A.
  • van Ierland, Ekko C.

Abstract

North Sea fisheries are managed by the European Union (EU) through a system of annual quota. Due to uncertainty about future fish stocks, yearly revisions of these policies lead to fluctuation in quota, which in turn affects harvest and investment decisions of fishermen. Determination of quota requires high management costs in terms of obtaining information and negotiations between experts and policy makers. To reduce both quota fluctuation and management costs, the EU has proposed a system of multiannual quota. In this paper we study the effect of multiannual quota on quota volatility and resource rents, while accounting for management costs. We develop a bi-level stochastic dynamic programming model, where at level one, the EU determines the quota that maximizes resource rents. At level two, fishermen decide myopically on their harvest and investment levels, subject to the quota. Results show that policy makers can reduce quota volatility and improve resource rents from the fishery with multiannual quota. Important trade-offs are involved in the accomplishment of these objectives: fish stock and investments become more volatile, which leads to more overcapacity.

Suggested Citation

  • van Dijk, Diana & Haijema, Rene & Hendrix, Eligius M.T. & Groeneveld, Rolf A. & van Ierland, Ekko C., 2013. "Fluctuating quota and management costs under multiannual adjustment of fish quota," Ecological Modelling, Elsevier, vol. 265(C), pages 230-238.
    • Handle: RePEc:eee:ecomod:v:265:y:2013:i:c:p:230-238
    DOI: 10.1016/j.ecolmodel.2013.06.019
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304380013003128
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ecolmodel.2013.06.019?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Eisenack, K. & Welsch, H. & Kropp, J.P., 2006. "A qualitative dynamical modelling approach to capital accumulation in unregulated fisheries," Journal of Economic Dynamics and Control, Elsevier, vol. 30(12), pages 2613-2636, December.
    2. Karagiannakos, A, 1996. "Total Allowable Catch (TAC) and quota management system in the European Union," Marine Policy, Elsevier, vol. 20(3), pages 235-248, May.
    3. Wise, Laura & Murta, Alberto G. & Carvalho, Joao P. & Mesquita, Marta, 2012. "Qualitative modelling of fishermen's behaviour in a pelagic fishery," Ecological Modelling, Elsevier, vol. 228(C), pages 112-122.
    4. Daw, Tim & Gray, Tim, 2005. "Fisheries science and sustainability in international policy: a study of failure in the European Union's Common Fisheries Policy," Marine Policy, Elsevier, vol. 29(3), pages 189-197, May.
    5. R. Quentin Grafton & Ragnar Arnason & Trond Bjorndal & David Campbell & Harry F. Campbell & Colin W. Clark & Robin Connor & Diane P. Dupont & Rognvaldur Hannesson & Ray Hilborn & James E. Kirkley & To, 2005. "Incentive-based approaches to sustainable fisheries," Economics and Environment Network Working Papers 0508, Australian National University, Economics and Environment Network.
    6. Homans, Frances R. & Wilen, James E., 1997. "A Model of Regulated Open Access Resource Use," Journal of Environmental Economics and Management, Elsevier, vol. 32(1), pages 1-21, January.
    7. Kenneth L. Judd, 1998. "Numerical Methods in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262100711, December.
    8. Singh, Rajesh & Weninger, Quinn & Doyle, Matthew, 2006. "Fisheries management with stock growth uncertainty and costly capital adjustment," Journal of Environmental Economics and Management, Elsevier, vol. 52(2), pages 582-599, September.
    9. Arnason, Ragnar, 2009. "Fisheries management and operations research," European Journal of Operational Research, Elsevier, vol. 193(3), pages 741-751, March.
    10. Rogers, Mark W. & Allen, Micheal S. & Brown, Paul & Hunt, Taylor & Fulton, Wayne & Ingram, Brett A., 2010. "A simulation model to explore the relative value of stock enhancement versus harvest regulations for fishery sustainability," Ecological Modelling, Elsevier, vol. 221(6), pages 919-926.
    11. Doyle, Matthew & Singh, Rajesh & Weninger, Quinn, 2006. "Fisheries Management with Stock Uncertainty and Costly Capital Adjustment," Staff General Research Papers Archive 12770, Iowa State University, Department of Economics.
    12. Schapaugh, Adam W. & Tyre, Andrew J., 2013. "Accounting for parametric uncertainty in Markov decision processes," Ecological Modelling, Elsevier, vol. 254(C), pages 15-21.
    13. Arnason, Ragnar & Hannesson, Rögnvaldur & Schrank, William E., 2000. "Costs of fisheries management: the cases of Iceland, Norway and Newfoundland," Marine Policy, Elsevier, vol. 24(3), pages 233-243, May.
    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. Diana Dijk & Eligius M. T. Hendrix & Rene Haijema & Rolf A. Groeneveld & Ekko C. Ierland, 2017. "An Adjustment Restriction on Fish Quota: Resource Rents, Overcapacity and Recovery of Fish Stock," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(2), pages 203-230, June.

    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. Diana Dijk & Eligius M. T. Hendrix & Rene Haijema & Rolf A. Groeneveld & Ekko C. Ierland, 2017. "An Adjustment Restriction on Fish Quota: Resource Rents, Overcapacity and Recovery of Fish Stock," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(2), pages 203-230, June.
    2. Jules Selles, 2018. "Fisheries management: what uncertainties matter?," Working Papers hal-01824238, HAL.
    3. McGough Bruce & Plantinga Andrew J. & Costello Christopher, 2009. "Optimally Managing a Stochastic Renewable Resource under General Economic Conditions," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-31, December.
    4. van Dijk, Diana & Hendrix, Eligius M.T. & Haijema, Rene & Groeneveld, Rolf A. & van Ierland, Ekko C., 2014. "On solving a bi-level stochastic dynamic programming model for analyzing fisheries policies: Fishermen behavior and optimal fish quota," Ecological Modelling, Elsevier, vol. 272(C), pages 68-75.
    5. Kailin Kroetz & James N. Sanchirico & Daniel K. Lew, 2015. "Efficiency Costs of Social Objectives in Tradable Permit Programs," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 2(3), pages 339-366.
    6. Poudel, Diwakar & Sandal, Leif K. & Steinshamn, Stein I. & Kvamsdal, Sturla F., 2012. "Do Species Interactions and Stochasticity Matter to Optimal Management of Multispecies Fisheries?," Discussion Papers 2012/1, Norwegian School of Economics, Department of Business and Management Science.
    7. Kvamsdal, Sturla F. & Maroto, José M. & Morán, Manuel & Sandal, Leif K., 2020. "Bioeconomic modeling of seasonal fisheries," European Journal of Operational Research, Elsevier, vol. 281(2), pages 332-340.
    8. Singh, Rajesh & Weninger, Quinn, 2009. "Bioeconomies of scope and the discard problem in multiple-species fisheries," Journal of Environmental Economics and Management, Elsevier, vol. 58(1), pages 72-92, July.
    9. Quentin Grafton, R. & Kompas, Tom & McLoughlin, Richard & Rayns, Nick, 2007. "Benchmarking for fisheries governance," Marine Policy, Elsevier, vol. 31(4), pages 470-479, July.
    10. Da Rocha Alvarez, Jose Maria & Prellezo, Raul & Sempere, Jaume & Taboada-Antelo, Luis, 2016. "Fleet dynamics and capital malleability," MPRA Paper 75370, University Library of Munich, Germany.
    11. Leizarowitz, Arie & Tsur, Yacov, 2012. "Renewable resource management with stochastic recharge and environmental threats," Journal of Economic Dynamics and Control, Elsevier, vol. 36(5), pages 736-753.
    12. Nicolas Sanz & Bassirou Diop, 2022. "Endogenous catch per unit effort and congestion externalities between vessels in a search‐matching model: Evidence from the French Guiana shrimp fishery," Bulletin of Economic Research, Wiley Blackwell, vol. 74(3), pages 838-853, July.
    13. Da Rocha Alvarez, Jose Maria & Prellezo, Raul & Sempere, Jaume & Taboada-Antelo, Luis, 2016. "Fleet dynamics and overcapitalization under rational expectations," MPRA Paper 79578, University Library of Munich, Germany.
    14. Cairns, Robert D. & Martinet, Vincent, 2021. "Growth and long-run sustainability," Environment and Development Economics, Cambridge University Press, vol. 26(4), pages 381-402, August.
    15. Koffi Akakpo & Marie-Amélie Boucher & Vincent Boucher, 2018. "Optimal Credible Warnings," Cahiers de recherche 1813, Centre de recherche sur les risques, les enjeux économiques, et les politiques publiques.
    16. Christopher Costello & Corbett A. Grainger, 2018. "Property Rights, Regulatory Capture, and Exploitation of Natural Resources," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(2), pages 441-479.
    17. Eihab Fathelrahman & Aydin Basarir & Mohamed Gheblawi & Sherin Sherif & James Ascough, 2014. "Economic Risk and Efficiency Assessment of Fisheries in Abu-Dhabi, United Arab Emirates (UAE): A Stochastic Approach," Sustainability, MDPI, vol. 6(6), pages 1-21, June.
    18. Sarkar, Sudipto, 2009. "Optimal fishery harvesting rules under uncertainty," Resource and Energy Economics, Elsevier, vol. 31(4), pages 272-286, November.
    19. Singh, Rajesh & Weninger, Quinn, 2015. "Harvest efficiency and fishery discards under harvest uncertainty and trading restrictions," Journal of Environmental Economics and Management, Elsevier, vol. 70(C), pages 72-91.

    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:eee:ecomod:v:265:y:2013:i:c:p:230-238. 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: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/ecological-modelling .

    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.