Tragedy in the Barents Sea? : optimal and non-cooperative exploitation of a shared renewable resource: the North-East arctic cod fishery

Cod from the Barents Sea, which is shared with Russia, is of cultural and economic importance to Norway. How should the resource be harvested to maximize its economic gain? Which implications has a non-cooperative exploitation from the two bordering nations? To answer these questions, simulations of a bio-economic model have been carried out. The optimal harvesting regime is contrasted to the outcome of current management and of competing exploitation

Threatening thresholds? The effect of disastrous regime shifts on the non-cooperative use of environmental goods and services

This paper presents a tractable dynamic game in which agents jointly use a resource. The resource replenishes fully but collapses irreversibly if the total use exceeds a threshold. The threshold is assumed to be constant, but its location may be unknown. Consequently, an experiment to increase the level of safe resource use will only reveal whether the threshold has been crossed or not. If the consequence of crossing the threshold is disastrous (i.e., independent of how far the threshold has been exceeded), it is individually and socially optimal to update beliefs about the threshold's location at most once. The threat of a disastrous regime thereby facilitates coordination on a “cautious equilibrium”. If the initial safe level is sufficiently valuable, the equilibrium implies no experimentation and coincides with the first-best resource use. The less valuable the initial safe value, the more the agents will experiment. For sufficiently low initial values, immediate depletion of the resource is the only equilibrium. When the regime shift is not disastrous, but the damage depends on how far threshold has been exceeded, experimentation may be gradual

Disentangling Effects of Policy Reform and Environmental Changes in the Norwegian Coastal Fishery for Cod

We construct a detailed bioeconomic model of the Norwegian coastal cod fishery. This fishery has been open access up to the policy change during the “cod crisis” of 1989/1990. To answer to what extent the subsequent increase in biomass and profits was due to improved management, we isolate the effect of environmental variability. Projecting stock and harvest forward in the counterfactual scenario of no intervention, we show that the policy had a small positive impact on biomass, but a pronounced positive effect on profits. The main drivers of profit gains are increases in productivity and savings in fuel and labor costs

International Fisheries Agreements with a Shifting Stock

When a fish stock shifts from one nation to another nation, e.g., due to climate change, the nation that loses the resource has incentives to deplete it, while the other nation, receiving the resource, has incentives to conserve it. We propose an analytical model to study under which circumstances self-enforcing agreements can align incentives. Our setup allows to distinguish between a fast and a slow shift and between a smooth or a sudden shift in ownership. We show that the shorter the expected duration of the transition, the higher the total equilibrium exploitation rate. Similarly, a sudden shift implies—by and large—more aggressive non-cooperative exploitation than a gradual shift. However, a self-enforcing agreement without side-payments is more likely for a sudden than for a smooth shift. Further, the scope for cooperation increases with the expected duration of the transition, and it decreases with the renewability of the resource and the discount rate. Most importantly, we show that concentrating on in-kind transfers can be very detrimental for shifting renewable resources: In some cases, there is no efficient bargaining solution without side-payments, even when there are only two players. The final version of this research has been published in Dynamic Games and Applications. © 2017 Springer Verla

Optimal management under institutional constraints:Determining a total allowable catch for different fleet segments in the northeast arctic cod fishery

Many real world fisheries have an individual vessel quota system with restrictions on transferability of quota or entrance of new vessels into the fishery. While the standard economic reasoning is that these institutional constraints lead to welfare losses, the size of those losses and optimal second-best policies are usually unknown. We develop a dynamic bioeconomic model, in which a scientific body provides an optimal TAC given restrictions on (i) transferability between vessel segments and (ii) entrance of new vessels. Further, we also quantify welfare losses arising from not maximizing economic welfare, but physical yield—which is actually the case in many fisheries. We apply the model to the Northeast Arctic cod fishery, and estimate not only the cost and harvesting functions of the various vessel types, but also the parameters of the biological model as well as those of the demand function. This allows us to determine optimal second-best policies and quantify corresponding welfare effects for our case study fishery

Ticket to spawn: Combining economic and genetic data to evaluate the effect of climate and demographic structure on spawning distribution in Atlantic cod

Climate warming and harvesting affect the dynamics of species across the globe through a multitude of mechanisms, including distribution changes. In fish, migrations to and distribution on spawning grounds are likely influenced by both climate warming and harvesting. The Northeast Arctic (NEA) cod (Gadus morhua) performs seasonal migrations from its feeding grounds in the Barents Sea to spawning grounds along the Norwegian coast. The distribution of cod between the spawning grounds has historically changed at decadal scales, mainly due to variable use of the northern and southern margins of the spawning area. Based on historical landing records, two major hypotheses have been put forward to explain these changes: climate and harvesting. Climate could affect the distribution through, for example, spatial habitat shifts. Harvesting could affect the distribution through impacting the demographic structure. If demographic structure is important, theory predicts increasing spawner size with migration distance. Here, we evaluate these hypotheses with modern data from a period (2000–2016) of increasing temperature and recovering stock structure. We first analyze economic data from the Norwegian fisheries to investigate geographical differences in size of spawning fish among spawning grounds, as well as interannual differences in mean latitude of spawning in relation to changes in temperature and demographic parameters. Second, we analyze genetically determined fish sampled at the spawning grounds to unambiguously separate between migratory NEA cod and potentially smaller sized coastal cod of local origin. Our results indicate smaller spawners farther away from the feeding grounds, hence not supporting the hypothesis that harvesting is a main driver for the contemporary spawning ground distribution. We find a positive correlation between annual mean spawning latitude and temperature. In conclusion, based on contemporary data, there is more support for climate compared to harvesting in shaping spawning ground distribution in this major fish stock in the North Atlantic Ocean

Ticket to spawn: Combining economic and genetic data to evaluate the effect of climate and demographic structure on spawning distribution in Atlantic cod

Climate warming and harvesting affect the dynamics of species across the globe through a multitude of mechanisms, including distribution changes. In fish, migrations to and distribution on spawning grounds are likely influenced by both climate warming and harvesting. The Northeast Arctic (NEA) cod (Gadus morhua) performs seasonal migrations from its feeding grounds in the Barents Sea to spawning grounds along the Norwegian coast. The distribution of cod between the spawning grounds has historically changed at decadal scales, mainly due to variable use of the northern and southern margins of the spawning area. Based on historical landing records, two major hypotheses have been put forward to explain these changes: climate and harvesting. Climate could affect the distribution through, for example, spatial habitat shifts. Harvesting could affect the distribution through impacting the demographic structure. If demographic structure is important, theory predicts increasing spawner size with migration distance. Here, we evaluate these hypotheses with modern data from a period (2000–2016) of increasing temperature and recovering stock structure. We first analyze economic data from the Norwegian fisheries to investigate geographical differences in size of spawning fish among spawning grounds, as well as interannual differences in mean latitude of spawning in relation to changes in temperature and demographic parameters. Second, we analyze genetically determined fish sampled at the spawning grounds to unambiguously separate between migratory NEA cod and potentially smaller sized coastal cod of local origin. Our results indicate smaller spawners farther away from the feeding grounds, hence not supporting the hypothesis that harvesting is a main driver for the contemporary spawning ground distribution. We find a positive correlation between annual mean spawning latitude and temperature. In conclusion, based on contemporary data, there is more support for climate compared to harvesting in shaping spawning ground distribution in this major fish stock in the North Atlantic Ocean