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Design principles for individual transferable quotas

Author

Listed:
  • Townsend, Ralph E.
  • McColl, James
  • Young, Michael D.

Abstract

Individual transferable quota (ITQ) institutions should be designed to minimize two types of transaction costs. First, to minimize the costs of transferring ITQ rights among rights-holders and users, rights should be separated into three components: a permanent entitlement share, an annual catch allocation, and a license to fish. Second, ITQ rights can reduce the transactions costs for development of self-governance by owners both by specifying a non-unanimous voting rule (preferably one-share/one-vote) and also by delineating clear standards for devolution of responsibility from government. These same two principles for reduction of transactions costs can be applied, with slight variation, to individual transferable input systems.

Suggested Citation

  • Townsend, Ralph E. & McColl, James & Young, Michael D., 2006. "Design principles for individual transferable quotas," Marine Policy, Elsevier, vol. 30(2), pages 131-141, March.
  • Handle: RePEc:eee:marpol:v:30:y:2006:i:2:p:131-141
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    Citations

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    Cited by:

    1. Ralph E. Townsend, 2010. "Transactions costs as an obstacle to fisheries self-governance in New Zealand," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(3), pages 301-320, July.
    2. Coglan, Louisa & Pascoe, Sean, 2015. "Corporate-cooperative management of fisheries: A potential alternative governance structure for low value small fisheries?," Marine Policy, Elsevier, vol. 57(C), pages 27-35.
    3. Pierce, Brett & Mozumder, Pallab, 2014. "Perceptions and preferences of commercial fishers for dedicated access privilege framework in a multispecies fishery," Marine Policy, Elsevier, vol. 45(C), pages 52-59.
    4. Townsend, Ralph E., 2010. "Transactions costs as an obstacle to fisheries self-governance in New Zealand," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(3), September.
    5. Lawrence J. White, 2006. "The Fishery as a Watery Commons: Lessons from the Experiences of Other Public Policy Areas for US Fisheries Policy," Working Papers 06-18, New York University, Leonard N. Stern School of Business, Department of Economics.

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