Topic Area: Informal Property Rights in Fisheries
Geographic Area: Maine, United States
Focal Question: Can establishing informal property rights be an effective method to maintain sustainability in fisheries?
Sources:
(1) Acheson, James. The Lobster Gangs of Maine. Hanover, NH: University of New England, 1988. (2) Conkling, Philip W. Islands in Time. Rockland, ME: Island Institute, 1999. (3) Tietenberg, Tom. Environmental Economics and Policy. 2^nd ed. Reading, MA: Addison Wesley, 1998. Reviewer: Nick Owens, Colby College ’04

Review:

The Maine lobster industry represents a large part of the local economy, and its sustainability, therefore, is essential in maintaining the economic vitality, as well as the cultural identity of coastal Maine. The lobster industry has been successful in managing its biological resource, so as to ensure steady and sustainable harvests annually. A long history of regulation can largely be attributed to this success. However, certain isolated areas along the Maine coast have traditionally afforded greater harvests and provided greater income to those who fish there. These areas are characterized by limited-access, which is monitored and enforced by groups of lobstermen.

The limitation of access has been effective because it provides current users with an incentive to preserve the stock. Exclusive access to a resource will lead to maximization of net benefits generated by the resource over time. Thus, exclusive access creates an incentive, absent extremely high discount rates, to ensure sustainable harvests over time. Furthermore, exclusive access will lead to maintenance of a high stock of the resource, so that less effort is required to harvest a given efficient sustainable yield. The absence of established property rights and the presence of free-access creates a lack of concern for asset value because the scarcity rent from the stock cannot be appropriated by an individual fisherman. Thus, the incentives to preserve the stock are reduced because any individual self-restraint will not lead to individual benefit. Garret Hardin refers to this effect as the “tragedy of the commons,” which he explains as the result of a natural individual profit-maximizing rationality… “Even if an individual fully perceives the ultimate consequences of his actions he is most unlikely to act in any other way for he cannot count on the restraint his conscience might dictate being matched by a similar restraint on the part of all others (Tietenberg, 202).” The extraordinary success of certain areas of the Maine lobster fishery are enabled by the assurance that an individual has that others will impose “similar restraint.”

This similar restraint is assured because some areas of the fishery are divided into territories that are enforced by “lobster gangs (Acheson, 1998).” These gangs monitor their territorial waters, and make sure that no outsiders set traps there. Because legal remedies are not available to deter fishermen from intruding on territorial waters, lobster gangs rely on coercion to maintain their borders. If traps are set by an outsider in territorial waters, then a warning, such as an open trap door, may be issued. If warnings are not heeded, then some lenient members of the gang may issue second warnings to move traps. If these warning are not heeded, the ropes to traps will be cut. The fact that traps are expensive and enforcement is historically credible, provides a strong incentive not to set traps within territorial waters despite the lack of legal divisions. “You won’t find these marine metes and bounds recorded in deeds, but you can be sure the boundaries are nonetheless fixed (Conkling, 186),” and adhered to.

The entire Maine coast is divided into seven zones, and lobstermen are required by Maine law to only fish the zone allowed by their license. Territorial waters are subdivisions of these zones. However, all coastal waters are not divided into subdivided territories enforced by gangs. The prerequisites to form gangs are substantial enough as to limit the number of enforceable territories. One is not able to simply claim a territory and mark it off for individual or communal use. Thus, new territories cannot be formed- rather they are maintained according to historical family and communal use. Lobstering is an old occupation, and one that is continued by succeeding generations. Territories are remnants of patterns of use established by preceding generations. Access based on traditional uses are respected by Maine lobstermen because of a strong belief that generations of use legitimates ownership and further use.

Island communities are most effective at maintaining enforceable territories. The same families have lived on them for centuries, and they have developed a closeness and trust that promotes a collective approach to protecting the resource. Because communities see the value in the sustainability of the lobster resource, they have a strong incentive to protect it. Therefore, in addition to limiting access from outsiders, regulations are often imposed, such as lower trap limits and limited seasons. By reducing the pressure put on the territories that gangs “own,” they are, in effect, increasing the stock by allowing it to regenerate. This allows less effort to be expended in harvesting similar levels.

Larger stocks require less effort to harvest similar levels, which reduces costs through reductions in capital expenditures, such as less traps and smaller boats. It also reduces marginal costs, such as labor, fuel, and bait costs. Reductions in costs, caused by making inputs more productive and therefore requiring less of them, increase profits of lobstermen who are part of territorial gangs. Acheson finds that lobstermen who are part of territorial gangs catch more pounds per trap, and as a result, they earn, on average, 25% more than those who are not (Acheson, 156). Part of this increase in income can be attributed to a greater percentage of larger lobsters resulting from less pressure on the resource stock so that lobsters are not immediately harvested when they reach a legal size. Larger lobsters are more commercially valuable, and increase income, as do reduced costs.

The Maine lobster industry has been prudent enough to enact certain laws restricting the harvest of lobsters and thus maintaining sustainable flows from the lobster resource. However, “the most important rules of all, upon which the astonishing success of the fishery depends, appear in no statutes (Conkling, 194).” These rules are those which establish a sense of collective ownership, and in doing so, give lobstermen an incentive to preserve the resource which sustains their way of life.