A new study co-authored by an Ecotrust Canada researcher shows surprisingly negative economic impacts of individual transferable quotas (ITQs), at least when fishing quotas need to be leased by fishermen.
The study focuses on BC’s halibut fishery, which has been an ITQ showcase and supposed success story for those trumpeting quota fisheries, also known as “catch share” fisheries in the United States.
Despite the increasingly positive reviews of ITQs, few studies have considered how quota leasing activities can reduce the economic benefits to society and to fishermen operating under the ITQ fisheries system. This analysis reveals negative economic impacts of ITQs previously overlooked by examining the extent of quota leasing and the relationship between the catch value, the cost of fishing, and the quota lease price in the BC halibut fishery, long considered a poster child for ITQs.
The findings by Dr. Evelyn Pinkerton of the Simon Fraser University and Danielle N. Edwards of Ecotrust Canada challenge assumptions of economic theory used to promote the benefits of ITQs.
The researchers call the leasing of quotas “the elephant in the room” of the BC halibut fishery, and say that the system creates financial burdens for a large portion of the fleet rather than a positive effect for society. The study further showed that the system did not automatically steer quotas towards those fishermen with the least costs/highest yields. Instead, the initial “gifting” of quotas served to keep otherwise unsustainable fisheries on the market.
“The leasing of halibut quota is the ‘elephant in the room’ because its importance has been missed by analysts, and not incorporated into the overall evaluation of quota programs,” the researchers conclude.
Click here to download a PDF copy of An Elephant in the Room: The hidden costs of leasing individual transferable fishing quotas.