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Fish Quota Prices in Norway

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  • Rögnvaldur Hannesson

Abstract

Prices of fish quotas in Norway are not reported specifically, but can be estimated from the cost and earnings studies of the Directorate of Fisheries. Two methods of estimation are used: (1) increase in book value of fishing rights, and (2) annual amortization of quotas multiplied by their time of validity. It is found that the price of quotas, in most cases, exceeds the profit rate in the fishery and is often higher than the contribution margin. Hence quota prices in most cases exceed the resource rent and are more consistent with a willingness to pay for additional quotas bought to improve the utilization of existing equipment, in which case fixed costs are irrelevant. The puzzle of quota prices in many cases exceeding the contribution margin can be resolved by assuming that boat owners expect to keep a substantial portion of their purchased quotas through redistribution and use a low discount rate when evaluating quotas.

Suggested Citation

  • Rögnvaldur Hannesson, 2017. "Fish Quota Prices in Norway," Marine Resource Economics, University of Chicago Press, vol. 32(1), pages 109-117.
    • Handle: RePEc:ucp:mresec:doi:10.1086/689190
    DOI: 10.1086/689190
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    Cited by:

    1. Frank Asche & Andreea L. Cojocaru & Ruth B. M. Pincinato & Kristin H. Roll, 2020. "Production Risk in the Norwegian Fisheries," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 75(1), pages 137-149, January.

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