Property Rights and Efficiency in the Oyster Industry

Abstract

OWNERSHIP rights to resources and product are important determinants of economic efficiency. The effects of a communal or common property right system for resource allocation have received the principal attention of contributors to the literature pertaining to fishery economics. In the context of this literature, common property means that any member of the community has the right to harvest the fish stock. However, the right in practice may be constrained by government enforced conservation policies such as bag limits and size limitations. Consensus among the discussants is that common property leads to over-exploitation of fish stocks and perhaps extinction of the species.1 The property rights literature draws similar conclusions.2 To date, the literature contains few examples of empirical investigations of the effects of property right systems and, in particular, applications to the fisheries.3 In this paper the significance of property rights for one aspect of economic efficiency, labor productivity, is empirically tested using data from the U.S.