IDEAS home Printed from
   My bibliography  Save this paper

Efficiency Advantages of Grandfathering in Rights-Based Fisheries Management


  • Gary. D. Libecap


  • Terry Anderson


  • Ragnar Arnason



We show that grandfathering fishing rights to local users or recognizing first possessions is more dynamically efficient than auctions of such rights. It is often argued that auctions allocate rights to the highest-valued users and thereby maximize resource rents. We counter that rents are not fixed in situ, but rather depend additionally upon the innovation, investment, and collective actions of fishers, who discover and enhance stocks and convert them into valuable goods and services. Our analysis shows how grandfathering increases rents by raising expected rates of return for investment, lowering the cost of capital, and providing incentives for collective action.

Suggested Citation

  • Gary. D. Libecap & Terry Anderson & Ragnar Arnason, 2010. "Efficiency Advantages of Grandfathering in Rights-Based Fisheries Management," ICER Working Papers 31-2010, ICER - International Centre for Economic Research.
  • Handle: RePEc:icr:wpicer:31-2010

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Libecap, Gary D & Smith, James L, 2002. "The Economic Evolution of Petroleum Property Rights in the United States," The Journal of Legal Studies, University of Chicago Press, vol. 31(2), pages 589-608, June.
    2. Libecap, Gary D., 2007. "The Assignment of Property Rights on the Western Frontier: Lessons for Contemporary Environmental and Resource Policy," The Journal of Economic History, Cambridge University Press, vol. 67(02), pages 257-291, June.
    3. Jedidiah Brewer & Robert Glennon & Alan Ker & Gary Libecap, 2007. "Water Markets in the West: Prices, Trading, and Contractual Forms," ICER Working Papers 30-2007, ICER - International Centre for Economic Research.
    4. Hansen, Kristiana & Howitt, Richard E. & Williams, Jeffrey C., 2005. "An Econometric Test of the Endogeneity of Institutions: Water Markets in the Western United States," 2005 Annual meeting, July 24-27, Providence, RI 19548, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Provencher Bill & Burt Oscar, 1993. "The Externalities Associated with the Common Property Exploitation of Groundwater," Journal of Environmental Economics and Management, Elsevier, vol. 24(2), pages 139-158, March.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Fishing rights; property rights; allocating fishing rights; grandfathering fishing rights; auctions of fishing rights; fisheries rent;

    JEL classification:

    • N22 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: 1913-
    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:icr:wpicer:31-2010. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Simone Pellegrino). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.