From Open-Access to Individual Quotas: Disentangling the effects of policy reform and environmental changes in the Norwegian coastal cod fishery

• Environmental and Resource Economics Workshop

Date and Location

Friday, December 12, 2014, 1:40 PM - 3:00 PM
ARE Conference Room, 2102 Social Sciences and Humanities

Abstract

Understanding the effect of introducing property rights to natural
resources is central in economics, but empirical analysis is frustrated by
the complexity of socio-ecological systems.
We construct a detailed bio-economic model of the Norwegian coastal cod
fishery, which has traditionally been open-access, but was closed after
1989, isolating the effect of environmental variability. We project stock
and harvest forward in the counterfactual scenario of no intervention,
showing that the policy had only a small positive impact on stock biomass,
but a pronounced effect on profits. The main driver, uncovered by
index-number decomposition, is savings in fuel and labor costs.