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Designing Dedicated Access Privileges: Should They Be Place-based or Species-based?

James E. Wilen, Department of Agricultural and Resource Economics, University of California, DavisHiro Uchida, Department of Environmental and Resource Economics, University of Rhode IslandJose Cancino, Department of Agricultural and Resource Economics, University of California, Davis

Prepared for presentation at AAAS meetings:

New Approaches to Fisheries Management:

A Deeper Look at Dedicated Access Privileges

San FranciscoFebruary 18, 2007

The theme of the talk Two primary ways to establish dedicated access privileg

e-based fisheries management: ITQs--grant privileges to harvest individual species to in

dividual decision makers TURFs--grant use privileges to the ecosystem services in a

unit of space, generally to a group of decision makers ITQs (as conventionally operated) fail to account for c

ertain residual inefficiencies, chiefly spatial and within-season effort misallocation

TURFs may, in principle, account for some of these inefficiencies, but not without transactions and coordination costs

Literature and policy discussion focused on ITQs but less attention to TURFs

We discuss: case studies from Japanese and Chilean nearshore TURF systems.

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Motivation Accumulating Experience with ITQs suggests precondition

s and designs for success Clearly defined and secure harvest privileges that encoura

ge decentralized decision makers to innovate and protect the value of asset

Effective enforcement and monitoring system Corresponding conditions for success with TURFs less cl

ear Scope of privileges must be legitimized and codified at hi

gher level of government Co-management group must be able to establish and enforce

coordination mechanismso TURF sustainability requires resolving efficiency and equi

ty conflictso In developing countries, TURFs may be only hope for ration

alization

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Research Context of Talk Ongoing thesis research examining two TURF “meta- cas

e” studies, each with: Many different organizational configurations. Variations in key variables.

Organization characteristics, rules, activities, and performance.

Some variables constant. Social and cultural characteristics, legal structure.

Japanese coastal fisheries management 1,734 management organizations based on TURFs. Diverse fisheries, management rules and outcomes. One nation, same governing laws.

Chilean coastal Management Exploitation Areas About 400 TURFs with varying conditioning variables

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Japanese costal fishery management:Two fundamental institutions

Fishery Cooperative Associations (FCAs) Origin: fishermen guild in

feudal era. Granted rights to manage m

ultiple resources in nearshore TURF

Fishery Management Organizations Delegated rights to manage

species or gear group with TURF

© Graphical Survey Institute

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Fishery managing body: FMOs

Fishery Management Organizations (FMOs) Subgroup of FCA fishermen formed to collectively

manage a specific fishery/gear group.

FCA Co-op

(members)

trawl abalone seine shrimp

Decide tomanage

FMO

Decide tomanage

FMO

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Policy Questions

Why are FMOs created?What do harvester coops (FMOs) do?How do they decide what to do?Are their internal management mechanisms successful?Comparison: decentralized individual vs. centralized cooperative

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Data/Methods

FMO focus group interviews FCA Census: cross section/panel FMO mail survey

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Example of FMO:Small pink shrimp fishery

1960s race to fish: over harvesting, market glut, uneven grounds use, low price and income.

FMO established in 1968. Fishing Committee makes de

cisions on harvest and effort allocation--daily and annually

pooling arrangement harvest reduction, stock r

ebuilding local monopoly, volume con

trol, market facilities large income increase

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Effort coordination:Centralized effort assignment Without effort coordination:

Too much fishing effort at nearby hotspots Harvest focused on small and less valuable shrimp Too little fishing effort at less productive/distant hotspots.

Port

A

B

C

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Effort coordination:Centralized effort assignment

Location assignment (e.g. Suruga Bay shrimp fishery) Fishing Committee meets regularly Directs vessels (or groups of vessels) where to operate

Port

A

B

C

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Harvest, price and revenue: 1960-2002 (real price/revenues)

Harvest, Value, and Unit Price: 1960-2002In real price (base = 1995)

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

1960 1965 1970 1975 1980 1985 1990 1995 2000

Year

Metric tons

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Harvest

Value

Price

Revenue

Price

Price: YenRevenue: K Yen

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Focus Group Findings

The small pink shrimp fishery example, and other successful cases of FMOs often adopt: Effort coordination (EC) mechanisms in fishing to smooth effort over space

Pooling arrangements (PA). Market coordination/control.

Volume control to avoid market flooding. Quality control to fetch price premia. Cooperative facilities to maintain reputation

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Important Unanswered Question

Effort coordination mechanisms Pooling arrangements Output control

In what ways do these three factors interact to increase sustainable returns in TURF system fishery management (=FMOs)?

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Hypotheses

Increaseeconomic return

Outputmarketing

Costreduction

• Volume control• Quality control

• Efficient allocation of effort• Input sharing

Effortcoordination

Poolingarrangements

1

2

2

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Preliminary Investigation

10th Fishery Census (1998). Surveyed all “fishing units” = fishermen.

734 observations used in the analysis.

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Conclusions from Census Data

FMO fishermen on average have similar revenues per household as non-FMO fishermen.

Households in fisheries with FMOs and pooling arrangements have higher revenues.

Collective output marketing activities have significant impacts on revenues.

Cannot test pooling/effort coordination relationship

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Supplementary survey research

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Objective

Focus explicitly on how effort coordination mechanisms and pooling arrangements are related.

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Data

Mail survey to FMO managers nationwide focusing on effort coordination and pooling arrangements; first of its kind in Japan.

Designed the survey with additional assistance from collaborators in Japan.

Two batches of surveys sent out. First batch: FMOs with effort coordination and/or pooling arrangements.

Second batch: FMOs without effort coordination and/or pooling arrangements.

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Type EC PA Count

A X X 49

B X 22

C X 4

D 15

EC (A+B) 71

PA (A+C) 53

Total 90

FMO types among respondents

Quite a few FMOs with effort coordination but without pooling arrangements.

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0

.1

.2

.3

.4

Density

-2 0 2 4 6Log of revenue per unit of effort

Revs/EffortType A: EC & PAType B: EC onlyType C: PA onlyType D: None

Type A

Type D

Type B

Type C

Type A: $1,107Type B: $ 265Type C: $ 549Type D: $ 260

Effort coordination mechanisms and pooling arrangements

EC mechanisms AllA B

Location assignment 77.5% 75.5% 81.8 %

Joint fish search 15.5 16.3 13.6

Exchange information 47.9 46.9 50.0

Help landing at ports

57.7 63.3 45.5

Joint ownership: vessels

18.3 24.5 4.5

Joint ownership: gear

31.0 38.8 13.6

Total observed number

71 49 22

With PA Without PA

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Descriptive statistics:Self-imposed rules and practices

Rules and practices

AEC&PA

BEC only

DNone

Total

Joint Marketing

77.6% 68.2% 26.7% 64.4%

Volume control

75.5 72.7 60.0 72.2

Operation rules

91.8 100.0 86.7 92.2

Vessel/gear reg 46.9 18.2 0.0 32.2

N 49 22 15 90

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Preliminary Conclusions

Many FMOs adopted pooling originally to share burden of rebuilding, or to support spatial effort coordination

Pooling requires either homogeneous fishermen, or enough average revenue gain to compensate highliners loss in relative position

Once pooling is in force, it facilitates other collective activities such as marketing, branding, quality control

Collective output marketing activities have significant impacts on revenues.

More mature institutions jointly own vessels/gear

Gains emerge from intensification of use of each species

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Chilean TURF SystemManagement Exploitation Areas (MEAs)

Export boom in 1970s/1980s Led to overexploitation ITQ plan put in place for loco Monitoring/enforcement failure TURF system established

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Chilean TURFs

o Access privileges granted to harvester coops

o Privileges granted to all marine resources within well-defined nearshore space

o Main resources are benthic organismso Federal oversight--TACs, size limits and closed seasons, annual consultant reports

o Coops pay tax per hectare to federal government---supports oversight function

o No FMO-like organizations

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Structure of MEA system

11 large zones; north to south Harvester coops must apply to establish MEA

MEA determined by traditional use Currently over 400 MEAs Loco, limpet, urchin chief species Variation in initial conditions, methods adopted, success

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Data/methods

Focus group interviews Analysis of consultant reports Analysis of export data In person survey of MEA leaders

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Performance

Diversity of internal management methods

Range: virtually open access and overexploited to highly coordinated management

Successful MEAs coordinate: Spatial exploitation Harvest volume and timing Size distribution of landings Poaching enforcement

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Management mechanisms

Most create de facto IQs Allocate total TURF-specific TAC equally across production units

Spatial assignments plus pooling Harvest to fill market orders either: Free-for-all until market order filled Piece rates for divers for quantity/quality

Individual harvest targets Effort assignment, with and w/o pooling

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Interesting findings

Most MEAs harvest less than TAC Don’t agree with govt. biologists Adjusting harvest to market (banking)

Most also set larger size limit Some practice “ecosystem mgmt.”

Removing or relocating predators Moving loco to prey Removing loco prey predators

Some aquaculture MEA supplements income/part time Marine services use for tourism

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Comparative findings: Japanese Case

In Japan, rights originally granted to FCAs, but devolved to FMO groups

Most management innovation directed at intensification-by species Spatial management Revenue enhancement, collective marketing Aquaculture, production enhancement

o Pooling supports effort coordinationo Pooling also promotes club activities

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Comparative findings: Chile

Chilean MEA case grants rights to space; no FMO-like organizations

Much more focus on system (MEA-scale) externalities Predator/prey control Alternative uses (tourism) Poaching enforcement

Intensification of harvesting via: Spatial effort coordination-rotation/assignment

Temporal control of volume IQ allocation to harvesting units Some pooling, or harvest scheduling

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Take Home Messages (1): TURFs

Space-based DAPS are a viable alternative to species-based DAPS

Federal legitimization of spatial boundaries Creation of closed class---initial allocation Backstop regulations/scientific support

Incentives for collective stewardship Actual outcomes depend upon

Ability to internally coordinate Spatial effort control, harvest timing, quality Collective goods provision

Leadership, education, social cohesion Ability of manage transactions costs fairness Innovation

Implementation Issues

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Take Home Messages (2): TURFs

Self-enforcement Boundary enforcement Internal poaching/coop breakdown

Entry/exit New entrants

Apprenticeship period entry fee

The scale question Socio-economic vs. ecological? Role of negotiation and bargaining Mergers Resource productivity per capita Work time realignment; compression

Enforcement

Thank you