Optimal Allocation of TAC and the Implications of Implementing an ITQ Management System for the North-East Arctic Cod

Claire W. Armstrong and Ussif Rashid Sumaila


First, we study the allocation rule applied to split the Norwegian total allowable catch for cod between coastal and trawler vessels. Second, we explore the bioeconomic implications of an ITQ management system for this fishery. A model combining a cannibalistic biomodel with cooperative game theory is developed. Key results from the study are (1) the current allocation rule acts in opposite fashion to what may be considered bioeconomically optimal; and (2) an ITQ system for this fishery is likely to result in economic losses, as the biological advantages of harvesting with the two vessels types may be lost. (JEL Q22, Q28)

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