Cooperative Bargaining as an Alternative to ITQs:
Implications of the American Fisheries Act
By Scott C. Matulich and Murat Sever
ABSTRACT
The United States Congress recently passed a law that creates an alternative to individual transferable quota (ITQ) management. The American Fisheries Act (AFA) promises the ability to rationalize one of the world's largest fisheries, the North Pacific pollock fishery, without the appearance of allocating permanent property rights to a public resource. The Act enabled pollock fishers to form cooperative bargaining units that are guaranteed a fixed share of the total allowable catch providing they deliver to historic processors. This paper explores the political economy of policy change and the creative use of voluntary fishery cooperatives to advance rationalization.
The purpose of this article is to examine whether AFA can deliver on its promise. Initially, the political evolution of the Act is reviewed. Then, the distinction between traditional agricultural cooperatives and an AFA-style cooperative is explored. The theory of cooperative price formation is briefly reviewed, followed by an analysis of whether AFA is likely to deliver on its promise of fully compensated, win-win fishery rationalization.
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