Private Property and Economic Efficiency: A Study of a Common-Pool Resource

Posted: 20 Jun 2000

See all articles by Quentin Grafton

Quentin Grafton

The Australian National University

Dale Squires

Government of the United States of America - National Marine Fisheries Service (NOAA Fisheries Service)

Kevin J. Fox

UNSW Australia Business School, School of Economics

Abstract

The British Columbia halibut fishery provides a natural experiment of the effects of "privatizing the commons". Using firm-level data from the fishery two years before private harvesting rights were introduced, the year they were implemented, and three years afterwards, a stochastic frontier is estimated to test for changes in technical, allocative and economic efficiency. The study indicated that, one, the short-run efficiency gains from privatization may take several years to materialize and can be compromised by restrictions on transferability, duration and divisibility of the property right, two, substantial long-run gains in efficiency can be jeopardized by pre-existing regulations and the bundling of the property right to the capital stock and three, the gains from privatization are not just in terms of cost efficiency but include important benefits in revenue and product form.

JEL Classification: L33, Q18

Suggested Citation

Grafton, Quentin and Squires, Dale and Fox, Kevin J., Private Property and Economic Efficiency: A Study of a Common-Pool Resource. Journal of Law and Economics, Vol. 43, Issue 2, October 2000, Available at SSRN: https://ssrn.com/abstract=231786

Quentin Grafton (Contact Author)

The Australian National University ( email )

Crawford School (Bldg 132)
The ANU
Acton, Canberra, Australian Capital Territory 2601
Australia

HOME PAGE: http://https://crawford.anu.edu.au/people/academic/quentin-grafton

Dale Squires

Government of the United States of America - National Marine Fisheries Service (NOAA Fisheries Service) ( email )

8604 La Jolla Shores Drive
La Jolla, CA 92038-0271
United States
858-546-7113 (Phone)
858-546-7003 (Fax)

Kevin J. Fox

UNSW Australia Business School, School of Economics ( email )

High Street
Sydney, NSW 2052
Australia
(02)9385-3320 (Phone)
(02)9313-6337 (Fax)

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