Rent Dissipation in Chartered Recreational Fishing: Inside the Black Box



There are other practical reasons for avoiding taxation of catch effectiveness. First of all,
the very nature of catch effectiveness is that it is difficult to measure, being composed of
numerous inputs that are not easily observed by regulators. Furthermore, if such an index were
established and taxes implemented in a manner based upon this index, then there would be an
obvious incentive on the part of vessel owners to innovate so as to increase the effective catching
power obtained for any value of the index. Finally, if harvest is in anyway malleable with
respect to the decisions of anglers, then levies on catch effectiveness (or any input-targeted
instrument) will leave these endogenous sources of mortality unchecked - a criticism that does
not apply to a direct discard fee on anglers.

Rather than penalize catch effectiveness, per se, one could instead consider quantity
restrictions on key inputs in the harvest process. However, such an approach suffers from all the
prior criticisms of levies on catch effectiveness and is likely to face additional shortcomings as
well. For instance, a restriction on the number of lines allowed per angler will increase the
“virtual price” of this input (Neary and Roberts, 1980, Squires, 1994) leading to attempts by
vessel owners to substitute away from the regulated input into non-regulated inputs. Barring a
perfectly complementary relationship between the input and catch effectiveness, this attempt will
succeed to some degree.
38 The possibilities for such substitution may be considerable and little
understood on an
a priori basis. Accordingly, barring an omnipotent knowledge of the
production technology and factor costs faced by fishermen, regulators are likely to see their
attempts to reign in catch effectiveness frustrated. The dynamic manifestation of this process
may be a sequential game of “cat and mouse” between regulators and vessel owners - a pattern

38A restriction on fishing lines per angler may lead to the use of higher quality bait, increased chumming of the
waters, more powerful vessels to maximize fishing time or even a countervailing reduction in the density of
fishermen to enhance per-angler catch.

33



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