Record Details
Are Two Rents Better Than None? The Case for Monopoly Harvester Co-Ops
ScholarsArchive at Oregon State University
| Field | Value |
|---|---|
| Title | Are Two Rents Better Than None? The Case for Monopoly Harvester Co-Ops |
| Names |
Uchida, Hirotsugu
(creator) Manning, Dale (creator) |
| Date Issued | 2014-07-07 (iso8601) |
| Note | presentation |
| Abstract | Despite the efforts of natural resource economists to implement rights-based fishery management systems, many of the world’s fisheries remain over-exploited and lack an institution to change course. Given the status quo of overharvesting and depleted fish stocks, it seems natural for a harvester co-op to jointly curtail fishing mortality, which inevitably leads to reduced landings in the short run. Because of this, the legality of harvester co-op has been the topic of debate. Many authors have pointed out the potential conservation benefits of the creation of “conservation cartels,” however currently such co-ops are often considered as violation of antitrust law. In this paper, we use an optimal control model of a fishery with stock-dependent costs to compare the monopolist (cartel) outcome to a rent dissipated fishery. The monopolist creates rent by restricting harvest to increase price (monopoly rent) but also manages for an increased fish stock to decrease harvest costs (resource rent). Monopoly rent decreases welfare while the resource rent increases it. We develop a dynamic model of a fishery with the potential for market power and show that in fisheries with relatively elastic demand and/or costs that decrease quickly with an improved fish stock, a monopoly co-op can be socially preferred to continued rent dissipation. This result has important policy implications in fisheries where first-best solutions are not politically feasible the creation of a monopoly co-op can represent a social improvement. |
| Genre | Presentation |
| Topic | Fisheries Economics |
| Identifier | Uchida, Hirotsugu and D. Manning. 2014. Are Two Rents Better Than None? The Case for Monopoly Harvester Co-Ops. In: Towards ecosystem based management of fisheries: what role can economics play?: Proceedings of the Seventeenth Biennial Conference of the International Institute of Fisheries Economics and Trade, July 7-11, 2014, Brisbane, Australia. Complied by Ann L. Shriver & Melissa Errend. Corvallis, OR: International Institute of Fisheries. |
