Author(s):	Thorvaldur Gylfason, Martin Weitzman
Publication Date:	March 2003
Keyword(s):	fisheries management
JEL(s):	Q28
Programme Areas:	Public Economics
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=3849

We discuss the quota system by which Iceland?s fisheries have been managed since 1984, and explore its implications for economic efficiency as well as fairness. We argue that the shortcomings of the Icelandic quota system are inherent in any type of quota system applied to high-seas fishing. Further, we find that regulating access to a limited, stochastic common-property natural resource such as Iceland?s fish by fee rather than by quota ? i.e., by relying on price incentives rather than quantitative restrictions ? would constitute a more equitable and more efficient solution to the fisheries management problem. Our argument applies to the management of all open-seas fisheries, including the Common Fisheries Policy of the European Union.