Ex-vessel Pricing and IFQs: A Strategic Approach

Harrison Fell ()

Discussion Papers from Resources For the Future

Abstract: In this paper, intraseasonal fishing is modeled as a differential game between fishermen in a total allowable catch–regulated fishery with and without individual fishing quotas (IFQs). Heterogeneous harvest values are included by incorporating time-specific harvest costs and a stock effect into fishermen’s profit functions. I also allow for strategic interaction among fishermen via ex-vessel price dynamics. The equilibrium harvest strategies of the differential games are solved numerically through the use of a genetic algorithm. I demonstrate how different harvesting sector environments lead to varying degrees of ex-vessel price increases when IFQs are implemented. The primary result shows that possible margins for competition among fishermen, beyond competition for a greater share of the total allowable catch, can still exist under IFQ management and may be substantial enough to be able to prevent sizeable rent transfers from the processing sector to the harvesting sector.

Keywords: individual fishing quotas; property rights; differential games; genetic algorithm (search for similar items in EconPapers)
JEL-codes: Q22 C73 C61 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp, nep-cse, nep-env and nep-gth
Date: 2008-02-01
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