Abstract
This paper analyses sustainability of bilateral harvesting agreements in transboundary fisheries. Harvesting countries obtain public and private assessments regarding their stock of fish, and the stock experiences ecological changes. In addition to biological uncertainty, countries may face strategic uncertainty. A country that receives negative assessments about the current level of fish stock, may become ‘pessimistic’ about the assessment of the other coastal state, and this can ignite ‘panic-based’ overfishing. The paper examines the likelihood of overfishing and suggests a unique prediction about the possibility of abiding by bilateral fishing agreements. Conditions under which the outcome of the asymmetric-information model reduces to the symmetric-information game are discussed, and optimal policy instruments for intergovernmental management of the stock are offered.
Highlights
In 2013, 58% of the world’s assessed fish stocks were fully fished, with no potential for increase in production, and another 31% were overfished or depleted.1 by estimating the stock of thousands of unassessed fisheries around the globe Costello et al.This paper was part of my Ph.D. thesis at the University of Edinburgh
The structure of the paper is as follows: the related literature is reviewed in Sect. 2; the model is introduced in Sect. 3; in Sect. 4 the model is analysed under precise assessments and the risk-dominance equilibrium refinement is discussed; in Sect. 5 by assuming imprecise assessments the model is examined under biological and strategic uncertainties, and the global-game equilibrium refinement is introduced; the conclusion is in Sect. 6 and extended proofs are provided in Appendix
This paper set out to find a possible reason for failure to observe bilateral harvesting agreements in transboundary fisheries
Summary
In 2013, 58% of the world’s assessed fish stocks were fully fished, with no potential for increase in production, and another 31% were overfished or depleted. by estimating the stock of thousands of unassessed fisheries around the globe Costello et al. FAO yearbook (2016). This paper uses a model in which the fishery is threatened both by harvesting activities of the countries and the exogenous ecosystem factors An example of this is that the population of capelin fish in the Barents Sea has collapsed twice in 20 years due both to overexploitation and to multi-species-ecosystem effects (Hjermann et al 2004). A two-period model is presented, while the setup deals with the possibility of countries’ triggering the catastrophe at an earlier date The results of this model help a potential (intergovernmental) manager of the stock to explain the economic rationale of overfishing and the driving forces of the early collapse of such fisheries. The structure of the paper is as follows: the related literature is reviewed in Sect. 2; the model is introduced in Sect. 3; in Sect. 4 the model is analysed under precise assessments and the risk-dominance equilibrium refinement is discussed; in Sect. 5 by assuming imprecise assessments the model is examined under biological and strategic uncertainties, and the global-game equilibrium refinement is introduced; the conclusion is in Sect. 6 and extended proofs are provided in Appendix
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