climate change economics panel - holland

8/15/2019 Climate Change Economics Panel - Holland

1/20

The Role of Economics

In Addressing Impacts of Climate Change

on the Northwest Atlantic Marine Ecosystem

Preparing for Climate Change Impactson the Northwest Atlantic Marine Ecosystem

A symposium hosted by: Center for Law & Innovation of the University

of Maine School of Law, and Gulf of Maine Research Institute April 26-27


2/20

The Panel

Dr. Dan Holland (Chair)Resource Economist

Gulf of Maine Research Institute

Dr. Jon SutinenProfessor, Dept. of Environmental & Natural Resource Economics,

University of Rhode Island

Dr. Robert Johnson

Associate Professor and Associate Sea Grant DirectorUniversity of Connecticut


3/20


4/20

Three Basic Roles for Economics

Evaluate the costs and benefits and economic impacts of specificpotential outcomes (e.g. decline or extinction of a fish stock)

Understand how economic incentives influence human behavior,

and how that behavior influences outcomes (economic and

ecological). Assist in designing policies that create appropriate

economic incentives.

Evaluate how the set of institutions (including markets) that

comprise the overall human governance system for the marine

ecosystem affect outcomes. Assist in designing governance

systems that lead to appropriate behavior by individuals as well

as actors in the governance system.


5/20

Understanding and modeling humans as part of the

marine ecosystem

Fishery Management Measures

(e.g. mesh size, closed areas,

effort limits, trip limits, quotas)

Outcomes

Biological, Economic, Social andAdministrative

The Fishery System

Biological, Human andTechnological Components

Fishery Policy Making Institution

Legislative mandates and courtimposed requirements

Incentives of policy makers Stakeholder input Information to predict outcomes

Environmental influences

(e.g., weather, oceanography, etc)

Information and incentives

of fishermen

Markets for inputs and outputs


6/20

Direct and Indirect coupling of fisheries through

economic, regulatory, environmental and ecological linkages

Lobster

Groundfish

Herring

Human

Markets, technology,

regulations, etc.

Environment

Environment Environment


7/20

Dr. Robert JohnsonAssociate Professor and Associate Sea Grant Director

University of Connecticut


8/20

Climate Changeand the Allocation of Fishery Resources

Daniel S. HollandGulf of Maine Research Institute

Preparing for Climate Change Impactson the Northwest Atlantic Marine Ecosystem

A symposium hosted by: Center for Law & Innovation of the University ofMaine School of Law, and Gulf of Maine Research Institute April 26-27


9/20

Climate Change, Fisheries and Diversification

There is a high degree of uncertainty about how specific fisherieswill be affected by climate change

It is highly likely that some existing fisheries will decline while

others will increase

Most fishermen now have limited ability to respond to thesechanges by shifting from declining fisheries into healthier ones

If changes in fisheries productivity are slow, this may be a limited

problem, but even gradual climate changes may result in relatively

quick and dramatic shifts in productivity for some species


10/20

From Limiting Access to Limiting Options

Limited access has been implementedin most fisheries in New England overthe last few decades

Excess fishing capacity has requiredfirst limiting and then reducing the

number of active fishermen and howmuch they can fish

The general rule has been to grantongoing access to the most activefishermen and to virtually eliminateaccess for everyone else

The end result is that fishermen havebecome more specialized and lessdiversified


11/20

The A-B-Cs of Groundfish Fishery Access

In 1994 Amendment 5 implemented a limited accessscheme for the Northeast Multispecies Fishery and

allocated fishing days to individuals.

Effort allocations were further curtailed with Amendment

7 in 1997 and

Additional cuts were still necessary in 2002 asAmendment 13 was being crafted and substantial latent

effort still existed in the fishery.

The decision was made to create A, B and C days

with only active vessels being granted A and B days.

C days can not be used for the foreseeable future. B

days could only be used for special access programs.

A current management proposal could require fishermen

to choose a specific area within the Gulf of Maine


12/20

Lobster Management Zones:

Fishing in Little Boxes

Lobster permit

holders in Maine

must choose one

of seven zones

and must fish themajority of their

traps in that zone

Transfer is

possible, but

subject to long

waiting lists (years)


13/20

Other New England Fisheries

Scallops Amendment 4 limits access in 1994 Limited access permits with individual days at sea allocations

General category scallop (up to 400 pounds of meats per day) remained open

to a much larger (but still limited) group but will soon curtail access under

amendment 11

Red Crab implemented limited access in 2002

Herring Amendment 1 limits access 2006

In all of these fisheries there was a clear need to limit effort and

catch, but the end result is that many fishermen have lostopportunities for diversification


14/20

What goes up may come down

Lobster Landings in Maine, Massachusetts and Rhode Island

0

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

80,000,000

1965 1970 1975 1980 1985 1990 1995 2000 2005

Year

Pounds

RI MA ME


15/20

Happy Scallop Permit Owners, Others not so happy

Massachussets Scallop, Cod and Lobster Revenues

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

1980 1985 1990 1995 2000 2005

Year

Dollars

Scallop ($)

Cod, Haddock, Yellowtail ($)

Lobster ($)


16/20

A Portfolio Approach to Fishing Access Rights

Individualtransferable quotasmight provideopportunities todiversify fisheryaccess rights

Fishing cooperativeswith access rights tomultiple fisheriesmight do so as well

Both represent a

major cultural changethat many arestrongly resisting


17/20

Sharing the fish the international context

The Gulf of Maine is home to a number ofcommercially fished stocks that straddle USand Canadian waters (e.g. herring andseveral groundfish stocks)

Some highly migratory stocks fished in theGulf of Maine range even more widely (e.g.

Northern Bluefin tuna) Optimal management and perhaps even

sustainability of these stocks depends onbilateral or multilateral cooperation

Economists, using a game theoreticapproach, have demonstrated that climatechange could create country-level incentivesthat could destabilize cooperativeagreements and undermine sustainability


18/20

Implications of climate change for management of

transboundary fish stocks

A strong case can be made for the involvement of the 1977 shift in thePDO in destabilization of bi-national management of North AmericanPacific salmon fisheries (McKelvey et al. 2006).

Changing conditions for the North Sea herring stock are therefore likely toput agreements on cooperation under strain, especially because suchsecular changes in resource growth may be difficult to distinguish fromyear-on-year variability (Hannesson 2006).

The 1995 United Nations Fish Stocks Agreement facilitates the creation ofregional fishery management organizations (RFMOs) to govern harvestsof straddling and highly migratory fish stocks. The stability and success ofthese organizations will depend, in part, on how effectively they canmaintain member nations incentives to cooperate despite theuncertainties and shifting opportunities that may result from climate-drivenchanges in the productivity, migratory behavior, or catchability of the fish

stocks governed by the RFMO. Such climatic impacts may intensifyincentives for opportunism, and create other management challenges forthe RFMOs now governing tropical tuna fisheries in the Pacific and IndianOceans (Miller et al. 2007)


19/20

Sharing for now

The US and Canada

have only recently

developed agreements

on how to share

transboundary stocksof cod, haddock and

yellowtail flounder on

Georges Bank.

Herring is jointly

assessed but no

formal sharing

agreement is in place


20/20

Conclusions

Fishery management systems in New England tightly constrainfishermens choices and leave them highly vulnerable to shifts in

productivity of fisheries

Designing access rights that allow for greater diversification may insulate

fishermen from risks associated with climate change impacts on fisheries

This may also be important for generating support for tradeoffs betweenfisheries that may be desirable in the context of ecosystem based

management

Managing the marine ecosystem in the Northwest Atlantic depends on

international cooperation, and climate change may undermine existing

cooperative agreements Game theoretic analyses can point out why cooperation might break down

and may help in design of international treaties that will be robust to

potential climate change impacts

climate change economics panel - holland

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