The Privatization of the Oceans
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Rich with detail and provocatively argued, this study of the development of property rights in the world's fisheries tells the story of one industry's evolution and provides a useful illustration of the forces that shape economic institutions. The emergence of exclusive individual rights of access in the fishing industry began after the revolution in the international law of the sea that took place in the 1970s, when the offshore area controlled by a nation for fish and other resources expanded from 3 miles to 200 miles. Rögnvaldur Hannesson compares the subsequent development of private property rights in the fisheries to the historic enclosures and clearances of common land in England and Scotland and finds many parallels, including bitter fights over access rights and the impossibility of accommodating all those who want to stake a claim. Overall benefit to society in the form of increased efficiency, he points out, does not mean that all benefit equally. After tracing the development of the law of the sea since the sixteenth century, Hannesson considers what form property rights in fisheries might take and examines the forces behind the establishment of exclusive use rights to fish. He argues that one form of exclusive use rights, individual transferable quotas (ITQs), best promotes efficiency in the use of fish resources. He presents case studies of ITQ development, ranging from successful establishment in Canada and New Zealand to failures in Chile and Norway to experiments with ITQs in Iceland and the United States. The development of economic institutions, he concludes, is an evolutionary process subject to contradictory influences.
to take part in the East Indian trade.”3 The Dutch as a major trading and The International Law of the Sea 31 fishing nation had a clear interest in keeping access to trade, navigation and fishing as open as possible. The 3-mile limit, for many years virtually the norm for the width of national boundaries at sea, was based on a Dutch idea. More than 100 years after Mare Liberum was published, another Dutchman, van Bynkershoek, argued that the territorial sea should be based on the shooting
versus Norway and Denmark, for example). There were three principal ways in which the interests of the coastal states could be favored: (i) extending the jurisdiction over the continental shelf to the waters above the shelf, (ii) defining access rights to fish stocks The International Law of the Sea 37 with reference to in which state’s waters they originate or mainly are found, and (iii) establishing fisheries jurisdiction over a certain territory irrespective of ecological or topographical
be reached. It appears that the countries which were after the fish had a perhaps unique window of opportunity. The two superpowers at the time, the United States and the Soviet Union, had a common interest in preventing “creeping jurisdiction” which might interfere with their interests in unimpeded navigation of military vessels through straits and archipelagos that would become territorial waters if the limits of such waters were extended. To avoid this they were prepared to concede
investigation of alternative management solutions for the Alaska halibut and sablefish fisheries. ITQs were among the options and quickly became the preferred one. There was fierce resistance, however, against the idea. The opposition had various causes.9 One was ideology. Some people objected to privatizing a public resource through exclusive, individual use rights. A variant of that argument, but one which did not deny the efficacy of use rights for economic rationalization, was objection to
boat and B is the number of boats. The sustainable contribution of an additional boat to the total catch is the derivative of C with respect to the number of boats: dC/dB = f(B) + (df/dB)B. Since df/dB < 0 (the sustainable catch per boat falls as more boats are added), dC/dB < f(B) and could be negative. 3. Recreational fisheries are a different thing; the benefits of those fisheries are largely or wholly immaterial and do not fit within the framework of analysis in this book, which is concerned