Profit and Resource Rent in Fisheries

Flaaten, Ola; Heen, Knut; Matthíasson, Þórólfur

doi:10.1086/692074

Cited by 38 publications

(14 citation statements)

References 33 publications

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“…Again Policy could and often did respond by limiting the amount that fishing opportunities could be concentrated, but it is far too early to conclude that these measures are finally enough to ensure full equity in the distribution of benefits from fishing (Asche et al, 2018;Caswell et al, 2020). There is some reason for pessimism, in that at a minimum there is inherently an inequity between those who do and don't qualify to even have access to a quota share, and the governance and MCS processes that have had to be created and maintained to support setting accurate quotas, controlling access, and ensuring full compliance are complex and costly, often with costs recovered in full or in part by "resource rent" collected from the legal users (Flaaten et al, 2017;Gunnlaugsson et al, 2018). This makes the overall systems vulnerable to stochastic events such as environmental changes that would diminish stock productivity, require lower harvest and generate less revenue to support the governance and MCS systems just when their challenges have increased, and to politicization, as wealth and corresponding power is increasingly centralized in the interests of those who may benefit disproportionately from undermining constraints on their ability to increase their control over the processes.…”

Section: Discussionmentioning

confidence: 99%

Equity – the Bottleneck and the Opportunity

Rice

2021

Front. Ecol. Evol.

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There is a widespread tendency for diverse uses of Nature, on scales from small and local to very large, to become unsustainable. Once unsustainable, bringing a use back to sustainability and keeping it sustainable then takes substantial effort and tools appropriate to the context of the use. This Perspective first asks why is the tendency for unsustainability so pervasive, when it is an outcome that no user group has adopted as an objective, and ways to keep uses sustainable are known. I argue and present evidence that the common factor underlying the pervasiveness of unsustainable uses of Nature is inequity in the distribution of the benefits created from those uses, with both the wealthy “winners” of the distributional inequities and those disadvantaged and in poverty driving uses toward increasing unsustainability in ways that depend on the nature of the inequities. Unless the inequity of distribution of benefits from uses of Nature is addressed as an issue in its own right, there are few or no pathways to medium or long-term sustainable use. However, if inequity is addressed broadly and effectively, many pathways are available and societies can select the pathways appropriate to their cultural and ecological contexts.

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Section: Discussionmentioning

confidence: 99%

Equity – the Bottleneck and the Opportunity

Rice

2021

Front. Ecol. Evol.

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“…Different types of surplus can be generated in fisheries (Flaaten et al, 2017;Quaas et al, 2018). The economic rent computed above consists of resource rent, intra-marginal rent and producer surplus in the harvest and the processing industries.…”

Section: Discussionmentioning

confidence: 99%

Middlemen: good for resources and fishermen?

2019

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This paper studies the role of middlemen in open-access fisheries and how the organization of the supply chains affects resource exploitation and the level and distribution of economic rent. Imperfect competition among middlemen can help ensure that fish stocks are not depleted, which is typically the case in open-access fisheries with competitive markets. Middlemen with market power can also induce higher economic rent for the supply chain in total, but these rents mainly benefit the middlemen. The supply chains of inshore anchovy and offshore skipjack tuna fisheries in Vietnam are used as empirical examples. The analysis shows that in the anchovy supply chain, the middlemen have insignificant market power and the stock is being overexploited. In the skipjack tuna supply chain, the middlemen have oligopsony power and the stock is higher than the level that produces maximum sustainable yield.

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“…The wealth increase that has taken place among all players in the industry as a result of significant increases in quota prices during the study period (Hannesson, 2016;Flaaten et al, 2017), is not reflected in ROA calculations based on book values. Accordingly, other performance measures which do not apply the book value of balance sheet data supplement ROA calculations, *The crew size of both vessel groups constitutes about 10 full-time equivalent man-years and does not differ much during the period studied.…”

Section: Measuring Performancementioning

confidence: 90%

The Exploitation-Exploration Dilemma of Fishing Vessels With Institutionally Protected Quota Shares

Hannevig

Bertheussen

2020

Front. Mar. Sci.

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It is an established "truth" in the literature that a company which restricts itself to utilize existing resources without exploring new business opportunities is doomed to fail in the long run. An underlying premise for the claim is that the competition arena is dynamic and organized according to free competition principles. This study, however, examines whether it is more profitable for a fishing vessel to primarily exploit existing resources when the quota shares of the players are institutionally protected so that there is no real competition between them. The context is Norwegian seagoing purse seiners, which in 2005 experienced the introduction of a more market oriented individual transferable quota (ITQ) system with some distinct modifications. The vessels in the study were classified into strategic groups based on their exploitation versus exploration approaches. Financial accounts covering the period 2003-2017 were collected and analyzed to empirically address the issue. Some vessels did considerable explorative activities in the period studied by fishing related species, investing in quotas, and in new vessel technology. The findings suggest that firms which did not explore, but instead exploited their existing resource base performed relatively better than their peers except for EBITDA (earnings before interest, tax, depreciation and amortization) margin. Finally in the paper, the findings are discussed and implications outlined.

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Profit and Resource Rent in Fisheries

Cited by 38 publications

References 33 publications

Equity – the Bottleneck and the Opportunity

Equity – the Bottleneck and the Opportunity

Middlemen: good for resources and fishermen?

The Exploitation-Exploration Dilemma of Fishing Vessels With Institutionally Protected Quota Shares

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