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Unraveling the Multiple Margins of Rent Generation from Individual Transferable Quotas

Author

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  • Matthew N. Reimer

    () (Institute of Social and Economic Research, Department of Economics, University of Alaska Anchorage)

  • Joshua K. Abbott

    () (School of Sustainability, Arizona State University)

  • James E. Wilen

    () (Department of Agricultural and Resource Economics, University of California, Davis)

Abstract

Individual transferable quotas (ITQs) induce changes along the both the extensive margin—via consolidation of quota among fewer vessels—and the intensive margin, as harvesters adjust their behavior to ITQ incentives. We use ITQ introduction in the Bering Sea crab fishery to decompose the sources of rent generation across both margins. We embed an empirically calibrated structural model of the harvesting process into a sector-level model, allowing us to experimentally "unravel" the ITQ treatment. We show that the magnitude and source of rent generation under ITQs critically depends on the manner and degree of rent dissipation before ITQs are implemented.

Suggested Citation

  • Matthew N. Reimer & Joshua K. Abbott & James E. Wilen, 2013. "Unraveling the Multiple Margins of Rent Generation from Individual Transferable Quotas," Working Papers 2013-03, University of Alaska Anchorage, Department of Economics.
  • Handle: RePEc:ala:wpaper:2013-03
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    File URL: http://www.econpapers.uaa.alaska.edu/RePEC/ala/wpaper/ALA201303.pdf
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    References listed on IDEAS

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    Cited by:

    1. Chang K. Seung & Michael G. Dalton & André E. Punt & Dusanka Poljak & Robert Foy, 2015. "Economic Impacts Of Changes In An Alaska Crab Fishery From Ocean Acidification," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 6(04), pages 1-35, November.
    2. Ronald G. Felthoven & Jean Lee & Kurt E. Schnier, 2014. "Cooperative Formation and Peer Effects in Fisheries," Marine Resource Economics, University of Chicago Press, vol. 29(2), pages 133-156.
    3. Corbett A. Grainger & Christopher Costello, 2016. "Distributional Effects of the Transition to Property Rights for a Common-Pool Resource," Marine Resource Economics, University of Chicago Press, vol. 31(1), pages 1-26.
    4. Jardine, Sunny L. & Sanchirico, James N., 2015. "Fishermen, markets, and population diversity," Journal of Environmental Economics and Management, Elsevier, vol. 74(C), pages 37-54.
    5. Joshua K. Abbott & Alan C. Haynie & Matthew N. Reimer, 2015. "Hidden Flexibility: Institutions, Incentives, and the Margins of Selectivity in Fishing," Land Economics, University of Wisconsin Press, vol. 91(1), pages 169-195.
    6. Knútsson, Ögmundur & Kristófersson, Daði Már & Gestsson, Helgi, 2016. "The effects of fisheries management on the Icelandic demersal fish value chain," Marine Policy, Elsevier, vol. 63(C), pages 172-179.

    More about this item

    Keywords

    fisheries; ITQ; production function; intensive margin; Alaska; crab;

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory

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