Adopt Icelandic style fisheries policy to boost sustainability, argues IEA
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The solution to the problem of unsustainability is to establish property rights in sea fisheries – their absence has led to the exploitation and decimation of fish stocks. A new briefing from the Institute of Economic Affairs argues that sustainability can be achieved with an Icelandic-style system of ‘perpetual tradable quotas’. When it comes to farmland, no-one questions the right to private property, and very few would advocate that farms should be nationalised or unowned, as it would lead to chaos, inefficiency and environmental catastrophe. The same principle should apply to fish stocks – though the practicalities are different.
A tradable quota system should be introduced through which quotas of fish are allocated to trawlers as a share of the annual total allowable catch. Crucially this quota share should be a right in perpetuity that can be traded. All trawler owners would have an incentive not to set the allowable catch too high as doing so would damage future yields and immediately affect the value of their quotas. The introduction of tradeable quotas would combat the practical difficulties which make property rights in the sea much more of a challenge than on land.
- Establishing property rights gives fishermen a long-term interest in sustainability, helping the environment as stocks are not plundered.
- Because each trawler owner’s right stretches into perpetuity, trawler owners have an incentive to set the catch every year in a way that maximises sustainability. They would recognise that over-fishing would diminish future returns and immediately reduce the market value of the tradable quota.
- Evidence from Iceland shows that such a system creates harmony between all parties, producing cooperation as well as a sustainable fishery.
- Whilst quotas are set by the government in Iceland, the job could easily be given to the trawler owners.
Commenting on the briefing, its author, Professor Philip Booth, said:
“The CFP has been wasteful and hugely damaging to the sustainability of fisheries and the environment more widely – though there have been improvements in later years. The UK now has a brilliant opportunity to take back control of its fishing stocks. The best way to do this is by emulating Iceland’s system of tradeable quotas. Trawler owners would have a property right that gives a long-term interest in sustainability. Politicians should accept this general principle and set to work dealing with the practical details, which will be complex.”
Notes to Editors:
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The full report, Fisheries policy outside the EU, by Prof Philip Booth, can be downloaded here.
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
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