Economics of Ocean Resources

Introduction

There are three schools of thought regarding the management of common property resources. These are privatization of common resources, public property governed by state rules, and community-based management. Privatization involves creating and enforcing private property rights. The paper also summarizes evidence relevant to the management of common property resources. This paper discusses the possible use of common property to solve the commons problem in the light of James Acheson’s article “Lobster Fiefs.”

Economics of Ocean Resources

In his seminal publication “The Tragedy of Commons,” Garrett Hardin (1968) argued that common resources are vulnerable to degradation. Hardin noted that resources held in common is subject to a tragic loss because everyone acts in their self-interests. Hardin’s concept has been used extensively to account for overexploitation of common pool resources like forests, fisheries, and overgrazing. This concept postulates that individuals, acting in their self-interests, will inescapably cause damage to common pool resources. When rules or regulations are not enforced, there is nobody to carry the cost of degradation of common resources. The consequence is overexploitation and free riding. Freedom in the commons brings ruin to all (Hardin, 1968, p.1244). To overcome this tragic loss, Hardin offered that common property should be converted into public property or privatized. Common property resources can be either communal property, state property, private property, or open access. While these types are ideal, most resources are held inn conflicting blends of these regimes.   

Robert Wade (1987) offers that state regulation or privatization are not the only means of preventing massive degradation of the commons. Wade believes that people sharing common resources can organize collectively under certain conditions for a common goal- maintain healthy levels of common resources. Wade studied several cases of collective action to manage common property resources based on Indian villages. He noted positive cooperation in some water-scarce villages. Wade (1987) did observe suspicious and violations by some villagers who tried to gain unfair benefits for themselves. But the villagers often addressed these challenges in the public. Management of common pool resources by collective action entails norms of trust and cooperation. Wade argues that private property rights have been inappropriately applied to certain common resources. The author also provides a set of conditions for the successful of collective action. Wade proposes the need for the government to help collective action on the management of common property resources by the local regimes by offering technical assistance and legal framework.

Private property rights is not the only solution to address the commons problem. The tragedy of commons can also be addressed through community-based management of common resources. Hardin’s concept is incorrectly assumed to be the fate of the commons. James Acheson (1974) has critiqued Hardin’s notion by advancing an understanding that local cultures, histories, politics, and conditions influence management of the common property. There are several examples of common property resources that have been successfully managed for decades without leading to massive degradation. One such an example is Maine lobster industry. Despite decades of overexploitation, Maine lobster industry remains one of the most successful fisheries. Lobster catches have been high and stable throughout the years. Why has the Maine Lobster been so effective and successful?

For many generations, the local communities have managed to preserve lobster fishing at sustainable levels. One main reason associated with this successful exploitation of lobster fishing at sustainable levels is effective extra-legal community-based management strategy. Maine Lobstermen have often opposed government interventions to manage Maine fisheries by striving to limit access themselves. With few state conservation laws and lack of federal government effort to regulate the lobster industry, lobstermen have relied upon informal property rights to fish in ocean resources surrounding their own communities.  Additionally, they prevent strangers from using these fisheries. By so doing, they have been able to address the commons problem. Theoretically, what one needs to set a lobster trap in the fisheries is a state licensure (Acheson, 1988). But practically, one needs to be accepted into harbor hang to be able to place traps in the fisheries. They have also managed to solve two issues that conservation failed to address. Maine laws have so little to limit fishing effort and restrict entry into fishing industry. The lack of stringent conservation laws led local peoples to assert territorial and access rights to marine resources. This local arrangements have had significant ecological and economic ramifications.

Acheson (1988) describes community-based lobster fishermen in Maine who for many generations have kept sustainable levels of lobster fishing efforts by instituting and delineating norms and practices for managing the lobster resources they use. These practices serve to prevent the entry of outsiders in the fishing territories or spaces they depend on. The main goal is to lower competition pressures in certain territories by claiming prior rights.

Definition of territorial boundaries varies with distance from the shore. Boundaries near the shore are well mapped while boundaries away from the shore are less known. Fishermen are permitted to put fishing traps only in the territories close to their harbor, otherwise fishing in the areas of other’s harbor are sanctioned by violence, destruction of fishing gear, or total lobster wars (Acheson, 1974).  

Acheson (1974) identifies two types of fishing areas, which are nucleated and perimeter defended. In respect with nucleated fishing spaces, the gang has strong fishing rights in shores close to their harbor. However, “the sense of ownership grows weaker the further from the harbor mouth one goes (Acheson, 1974: p.190). Fishermen who live in the locality are easily accepted into the harbor gang. Any stranger found fishing close to others’ harbor would be sanctioned by violence. Coming to perimeter defended fishing spaces, the boundaries are starkly demarcated and defended to a yard. Unlike in the nucleated fishing areas, ownership does not grow weaker with distance from the harbor in perimeter defended fishing spaces. Claims on marine areas are closely related to formal land ownership. All lobster territories belonged to perimeter defended type prior to 1920. Nowadays, nucleated fishing areas are common.    

Conservation practices and territorialism are both economically and ecologically complimentary behaviors. Lobster territories in Maine are claimed and defended by harbor gangs. Because they generate large profits, defending lobster territories is worth the risk. The benefits of conservation effort accumulate to those in control of their fishing areas. Fishing spaces are defended by limiting access to strangers.  

Hardin’s theory of common-property resources seems not to hold true for Maine Lobster Fisheries. Hardin (1968) believed that private property offered a better protection of resources as compared with common property regimes. To avoid the tragedy of commons, Hardin held that common resources should be converted into public property or be privatized. Acheson has proven that Hardin’s assumption is either flawed or failed to account for collective arrangements in common property. With convincing data, Acheson shows that these community-based management practices and norms have maintained lobster stocks at sustainable levels while providing good returns to local resources users for many generations. Acheson’s argument illustrates that people are capable of organizing to monitor common resource use by members, allocate access/use rights among members, and adjust aggregate use levels to preserve sustainable resource use. Acheson believes that collection action is practical under appropriate circumstances.

Conclusion

This paper has summarized and discussed the problem associated with the management of common property resources. Hardin proposes converting common property resources to public property governed by state laws or creating private property rights to solve the commons problem. Wade prevents successful cases of collection action to show that privatization and public conversion are not the only means of managing the common property resources. Similarly, Acheson rejects Hardin’s school of thought by demonstrating the effectiveness of extra-legal community-based management of common property resources.

References

Acheson, J.M. 974. The Lobster Fiefs: Economic and Ecological Effects of Territoriality in the Maine Lobster Industry.” Human Ecology, 3(3): 183-207

Hardin, Garrett. 1968. The Tragedy of the Commons. Science, 162: 1243-48

Wade, R. 1987. The Management of Common Property Resources: Finding a Cooperative solution. Research Observer, 2(2); 219-234.

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