An Elemental Basis of Property Rights to Marine Fishery Resources
By Steve EdwardsABSTRACT
Divided ownership is efficient where production requires specialized skills and technologies and/or where interactions are negligible. Where damages caused by side effects are substantial, divided ownership might be used either by attenuating (e.g., gear restrictions) or excluding (e.g., zoning) a subset of attribute rights provided that the opportunity (reduced output) and transaction costs of restrictions/exclusions are less than damages. However, scientific uncertainty about resource ecology, the recurrent nature of interactions, the complexity of numerous contractual stipulations, and practical enforcement problems make it likely that the transaction costs of divided ownership are great at this time. Alternatively, property rights could be bundled into sets wherein tradeoffs across margins that promote the total wealth of a multi-attribute, common pool asset would be decided internally by a governance organization. Bundled sets of property rights influence the choice of organizational structures (government agency, commons, unitization of firms) and contracts (fishery management plans, rules, private contracts). The discussion is illustrated with examples from U.S. fisheries in the Northeast Region.
Keywords: ecosystem-based management, fisheries, property rights, transaction costs
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