The Political Economy of the European Common Fisheries Policy

Hoffmann, Julia

This dissertation addresses the political economy of the Common Fisheries Policy and investigates how traditional concepts can hinder the success of the European fisheries management. The first paper focuses on the institutional set-up of the decision-making process. This process is modeled as a dynamic non-cooperative game in discrete time. It is shown that due to the uncertainty in the annual TAC setting the optimal feedback strategy for the impatient decision-makers is to set inefficiently high TACs in Markov-perfect Nash equilibrium. According to this theoretical analysis, the institutional set-up of the decision-making process itself promotes inefficient TACs. A binding commitment between the two groups of decision-makers to a long-term management plan could lead to a more sustainable fisheries management. The second paper is concerned with an empirical analysis of the distribution of bargaining power between different interests groups in the TAC decision-making of the European Union. The process is modeled as a cooperative game between two players with different interests regarding TACs. The estimation results show that the player representing interests of the fishing industry has the stronger bargaining position compared to the player representing conservation interests. The analysis also shows that scientific recommendations have a greater influence in the bargaining when the underlying data is of good quality. The conclusion is that effective TAC management requires both, a sound scientific assessment and a stronger inclusion of scientific advice. The third paper investigates the regional trade-offs of different management options of a multi-species management in the Baltic Sea. An ecological-economic model of the Baltic Sea is developed simulating the stock dynamics of interacting population in order to investigate a set of different strategic management options. The profits for each country participating in the Baltic fishery differ between the management options. We show that the inflexibility of TAC distribution according to the principle of relative stability can lead to regional inequality in future profits. A reallocation of profits is required to achieve a concordant agreement on strategic multi-species management goals. The fourth paper examines the efficiency of different segments of the Baltic trawler fleet in order to evaluate whether quota trade between vessels of different countries could improve the situation. The distance function approach is used to derive an equation to estimate the efficiencies of different fleet segments. Data for different vessel length categories for different countries is used. The estimation reveals significant asymmetries in the efficiencies between countries. Allowing for quota trade in the Baltic fleet could improve the overall efficiency. Such a transnational quota trading system would enable the fleet to coordinate its fishing activities far more flexible than under the fixed allocation of TACs according to the principle of relative stability.

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Hoffmann, Julia: The Political Economy of the European Common Fisheries Policy. 2015.

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