Efficiency of the New Zealand annual catch entitlement market. (May 2015)

• Record Type: Journal Article
• Authors: Stewart, James; Leaver, Jonathan
• Is Part Of: Marine policy. Volume 55(2015)
• Page Start: 11
• Page End: 22
• Publication Date: 2015-05
• Subjects: Annual catch entitlement (ACE) -- Efficient markets -- Information channels -- Transaction cost -- Deemed value; Marine resources -- Economic aspects -- Periodicals; Fisheries -- Periodicals; Ressources marines -- Aspect économique -- Périodiques; Pêches -- Périodiques; Fisheries; Marine resources -- Economic aspects; Periodicals; 333.916405
• DOI: 10.1016/j.marpol.2015.01.005
• Languages: English
• ISSNs: 0308-597X

Abstract

Abstract: Balancing catch with annual catch entitlement (ACE) is crucial both for the financial viability of fishers and for the efficient operation of the New Zealand quota management system (QMS). This study examines the information channels that are used by fishers to search for ACE availability, and notes how these channels differ between large and small fishers. Special attention is given to the viability of small independent fishers whose participation in the fishery is dependent on their acquiring ACE in the open ACE market. An ACE market survey along with extensive consultation captured the views of fishers, fish processors, and quota brokers. These sources provide valuable insights into the day-to-day operation of the ACE market. They suggest that while elements of market power are evident in the ACE market there are also characteristics of an efficient market. Highlights: The ACE market meets most of the conditions for efficient markets but barriers to entry exist in some fisheries. Small fishers rely on Licensed Fish Receivers (LFRs) for ACE information and to buy ACE. Fishers without their own ACE have difficulty acquiring ACE in the open market. Small fishers consider that they are at a competitive disadvantage in the ACE market. ACE market participants use networks, consisting of quota brokers, direct fisher contacts, and LFRs when sourcing/trading ACE. Acquiring sufficient ACE to balance bycatch is a major concern for fishers.