THE DEBATE over blue crab policy in Maryland is ignoring lessons learned by the management of other troubled fisheries.
Most economists and academic experts agree that over-fishing problems are rooted in open-access, property-right systems, where one only gains ownership of a fish when it is caught.
Any fish left by one fisher is likely to be caught by another. So rather than leaving fish reproduce, the incentive is to harvest the stock before others can. The race to catch fish results in more boats, gear and people than the resource can sustain.
The state is imposing shorter working days, mandatory days off and shortening the season on the blue crab industry. Other proposals include a ban on the catch of female crabs and gear restrictions. In other fisheries, these types of rules usually fail to improve fish stocks and increase the financial problems of the watermen because they ignore economic incentives and do not address the problem of open-access property rights.
The new regulations restrict fishing time, so watermen have an incentive to compensate with other inputs - what economists call "capital stuffing." They might use more bait so traps continue to catch crabs on "days off" or invest in faster boats to manage more traps in a given time.
Even if the regulations increase the crab population, it is costly to the watermen. Some environmentalists suggest that tax revenues be diverted to fund a subsidy for the idled watermen. Such a subsidy increases the economic waste created by the regulations and indefinitely sustains the overabundance of boats and watermen.
A better way to compensate watermen is to expand their property rights in the fishery and create a monetary benefit from both live and harvested crabs. Permanent, transferable trap licenses would create a saleable financial asset that rises in value when the crab stock is healthy and prevents open-access depletion by limiting the total number of traps.
The initial allocation of trap licenses would represent a significant decrease in traps and catch for most watermen. Some would sell their licenses and be compensated for leaving the industry while others would buy licenses so that they continue crabbing at a larger, more profitable scale. Maximum limits could be set on license ownership to alleviate concerns about consolidating crabbing among a few large, corporate ventures.
Other fisheries demonstrate the failure of regulations and the success of individual transferable trap licenses or catch quotas.
Between 1979 and 1990, the Pacific halibut season was cut from over two months to a week, yet fishing intensity increased and halibut stocks continued to plummet. The one-week fishing derby reduced safety, increased costs and reduced the value of the catch, which was sold frozen, not fresh.
The regulations were replaced in the mid-1990s with a system of transferable quotas. Halibut stocks are rebounding, fewer boats are fishing over a much longer season, and profits are up.
As fisheries recover, the catch per trap increases and the licenses rise in value. In Australia, lobster trap licenses that sold for a little over $1,000 in 1984, when tradable licenses were implemented, are now worth nearly $20,000. A waterman with only 50 trap licenses is now a millionaire. Watermen resist the urge to increase the number of traps because it would reduce the value of their licenses.
Studies of clam flats and oyster beds have shown for decades that private ownership results in higher profits and larger stocks than open-access property rights.
Transferable trap licenses are an innovation that allows the advantages of private ownership to extend to more wide-ranging species, and success stories are appearing around the world.
Maryland should resist the regulations that have failed in other fisheries and use the power of free markets and property rights to ensure a sustainable crab fishery.
Jeffrey Michael is assistant professor of economics specializing in natural resources and a member of the Environmental Science and Studies Advisory Board at Towson University.