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Effects of foreshortening of transferred quota in an ITQ market

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Abstract

This paper models and investigates the foreshortening of transferred quota which is applied in the Norwegian fisheries management. This reduction in the transferred quota amount by 20% is then redistributed amongst all vessels in the relevant vessel group. It is shown that fishing units can be expected to be operated longer, and capital renewed at a slower rate under foreshortening than if foreshortening is not used by the government. Foreshortening will most likely also reduce the value of the quotas. However, foreshortening may increase the value of the quotas if unit costs of fishing increase fast compared to the discount rate used by quota holders

Topics: Fisheries Economics, ITQs, Norwegian fisheries policy, Foreshortening of transferred quota
Publisher: International Institute of Fisheries Economics and Trade
Year: 2008
OAI identifier: oai:ir.library.oregonstate.edu:1957/37495
Provided by: ScholarsArchive@OSU

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