The Value of Secure Property Rights: Evidence from Global Fisheries

25 Pages Posted: 9 May 2011

See all articles by Corbett A. Grainger

Corbett A. Grainger

University of Wisconsin - Madison

Christopher Costello

University of California, Santa Barbara (UCSB) - Donald Bren School of Environmental Science & Management

Date Written: May 2011

Abstract

Property rights are commonly touted as a solution to common pool resource problems. But in practice the security of these property rights varies substantially owing to differences in design. In fisheries, the design of individual transferable quotas (ITQs) varies widely; the consequences of these design differences on economic outcomes has not been studied. To test whether the security of these property rights affects asset values, we compile a unique dataset to examine the relationship between the exclusivity of property rights and the dividend price ratios for ITQs. We find evidence that stronger property rights lead to higher asset values and lower dividend price ratios in ITQ fisheries. This pecuniary effect of property rights security informs the current policy debate on the design of property rights institutions for managing natural resources.

Suggested Citation

Grainger, Corbett Alden and Costello, Christopher, The Value of Secure Property Rights: Evidence from Global Fisheries (May 2011). NBER Working Paper No. w17019. Available at SSRN: https://ssrn.com/abstract=1833156

Corbett Alden Grainger (Contact Author)

University of Wisconsin - Madison ( email )

427 Lorch St.
Madison, WI 53706-1503
United States

HOME PAGE: http://www.aae.wisc.edu/cagrainger

Christopher Costello

University of California, Santa Barbara (UCSB) - Donald Bren School of Environmental Science & Management ( email )

4670 Physical Sciences North
Santa Barbara, CA 93106-5131
United States
(805) 893-5802 (Phone)
(805) 893-7612 (Fax)

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