Misconceptions about charter IFQs

Letter to the editor

Posted: Wednesday, November 09, 2005

Donna Bondioli's assertion that charter trip prices will rise to pay for the cost of purchasing charter sector quota share is refuted by the original North Pacific Fishery Management Council analysis of the charter IFQ program. In "Impacts on Anglers of the Proposed Halibut Charter IFQ System," resource economist Dr. James Wilen writes that "while this is a commonly held view, it is a mistaken one in that it gets the direction of causality reversed. The actual mechanism is that sports charter trip costs will determine IFQ prices rather than the other way around."

Ms. Bondioli's example is also misleading in a number of ways, but I will mention only her greatest error. She wrongly assumes that the price of charter sector quota share will be the same as that for commercial sector quota share. They won't be the same, because the pool of charter sector quota share will be separate and distinct from the pool of commercial sector quota share. The price will be determined by the market for charter trips independent of the commercial sector.

Members of the public who are interested in this issue would do well to read the original analysis and related documents on the fishery management council's Web site.

Dan Hull


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