On the economic nature of consumers’ willingness to pay for a selective and sustainable fishery: A comparative empirical study

Abstract

The EU Landing Obligation (LO) bans discards to incentivize a more selective and sustainable fishery. This regulation may induce a cost to the fishing industry that could be transferred to final fish consumers. We aim to assess the consumers’ reservation price for a sustainable and selective fishery. The methodology follows two steps: We first assess the value of the reservation price (willingness to pay, WTP) for a sustainable and selective fishery by using contingent valuation methods from a comparative perspective in Spain and Italy. We then attempt to empirically assess the components of WTP by using an original model specification that, unlike those presented in the literature, exogenizes socio-economic variables and uses ideological indicators to explain WTP in a two-line simultaneous model estimated by instrumental variable regression. The results show a positive, though low, WTP across the two samples, and very different impacts of estimated coefficients on the WTP for the two samples. A preliminary interpretation of this divergence highlights that Italian consumers consider LO-incentivized sustainable fishery a pure public good linked to issues of legality, and Spanish consumers consider it an impure public good linked to environmental issues. These differences may indicate how strongly the institutions and the policies in each region are perceived by a different human capital structure. They may also indicate that the problem, the perceptions of it and the solutions to it differ according to the context.