A Policy Impact Analysis of New England Groundfish Sectors and Effort Redirection into Mid-Atlantic Fisheries

Abstract

United States commercial fisheries are managed by regional councils whose jurisdictions are circumscribed by political boundaries. Species range often spans management borders, linking fishing regions by participation. On the East Coast, individuals commonly prosecute several fisheries managed by different councils. This study tests both the existence and magnitude of policy-induced transboundary impacts on fishery participation, with the goal of providing a quantitative starting point for further investigation into the economic and social impact of spillover fishing effort. Regulatory structures vary across a spectrum from open access to individual harvest rights. In 2010, the New England Fishery Management Council expanded a cooperative rights-based management program – “sectors” – to enhance stock sustainability and economic efficiency in the groundfish fishery. Groundfish sector management altered the deployment of fishing effort in New England. Newly idled groundfish fishers possess the potential to increase participation in regulated open access Mid-Atlantic fisheries characterized by low entry barriers. This study utilizes econometric methods to estimate the transboundary effect of sector management on Mid-Atlantic fisheries. The use of a difference-in-differences estimation strategy allows the author to evaluate the causal link between New England sector management and altered fishing effort directed towards Mid-Atlantic managed species. Econometric methodology is employed to control for exogenous factors that may also affect fishing effort and to assess the unobservable policy counterfactual of present day Mid-Atlantic effort levels in the absence of New England groundfish sectors. The study finds that the establishment of groundfish sectors does affect Mid-Atlantic fisheries, but impacts are not uniform across species nor are they uniform across the 17 groundfish sectors. Further, effort redirection can be more or less pronounced when looking at the behavior of enrolled sector members, or looking only at those sector members who are now inactive in New England fisheries. Certain sectors are identified as redirecting more effort towards Mid-Atlantic species. While cumulative effort spillover does not seem to be pushing Mid-Atlantic fisheries perilously close to capacity limits, the identified influx can impact profitability in effort-receiving fisheries and could potentially have a negative effect on socioeconomic outcomes in the greater regional fishing economy.