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Harvest efficiency and fishery discards under harvest uncertainty and trading restrictions

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  • Singh, Rajesh
  • Weninger, Quinn

Abstract

We study harvesting efficiency and the problem of discards under harvest uncertainty in a fishery that is managed with quotas. With only idiosyncratic harvest uncertainty, we show that frictionless post-harvest quota trade can achieve full efficiency and eliminate quota-overage discards completely. In the absence of such trade, we deduce an ad valorem tax/subsidy that eliminates discards while delivering a desired aggregate harvest target. Alternatively, we show that a hybrid policy, i.e., a combined quota and landings fee, can implement a manager׳s aggregate target harvest level efficiently and without discards. When harvest shocks, in addition, have a fishery-wide common component, post-harvest quota trading per se cannot eliminate discards; policy intervention in the form of either landing taxes or a hybrid scheme is needed. Given the prevalence of trading restrictions in many quota-managed fisheries worldwide, our paper offers important policy advice.

Suggested Citation

  • 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.
  • Handle: RePEc:eee:jeeman:v:70:y:2015:i:c:p:72-91
    DOI: 10.1016/j.jeem.2014.11.001
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    References listed on IDEAS

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    Cited by:

    1. Singh, Rajesh & Weninger, Quinn, 2017. "Quota flexibility in multi-species fisheries," ISU General Staff Papers 201707260700001026, Iowa State University, Department of Economics.
    2. Singh, Rajesh & Weninger, Quinn, 2017. "Quota flexibility in multi-species fisheries," ISU General Staff Papers 201707080700001026, Iowa State University, Department of Economics.

    More about this item

    Keywords

    Harvest randomness; Trading restrictions; Catch-quota imbalance; Discards;

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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