OPTIMUM ECONOMIC YIELD OF AN INTERNATIONALLY 

 UTILIZED COMMON PROPERTY RESOURCE* 



Lee G. Anderson'^ 



ABSTRACT 



The exploitation of a common property resource, specifically a fishery, by nationals of two countries is 

 discussed using a simple general equilibrium analysis. The interdependence of their production 

 possibility curves is used to describe the open-access equilibrium yield, local maximum economic 

 yields, and a true international maximum economic yield. Finally a complete description of the 

 conditions necessary for this international maximum economic yield and why they are different from 

 those in a national fishery is presented. 



The purpose of this paper is to analyse, using a 

 simple general equilibrium model, the problem of 

 the allocation of resources where common prop- 

 erty or open access exists for some of them. The 

 common property or open-access resource will be a 

 fish stock. The economics of fisheries has been 

 quite extensively developed. See for example Gor- 

 don (1954), Scott (1955), Crutchfield and Zellner 

 (1962), Turvey (1964), Crutchfield (1965), Christy 

 and Scott (1965), Smith (1969), Copes (1970), Scott 

 and Southey (1970), Gould (1972), Southey (1972), 

 and Anderson (1973). The present paper follows 

 Scott and Southey and uses a production possibil- 

 ity (PP) curve model which takes into direct ac- 

 count all the resources of the economy and not just 

 the fishery. This change in focus is especially use- 

 ful for analysing economic aspects of international 

 use of common property resources, a problem that 

 has long been recognized but which has received 

 very little treatment to date. The following quote 

 from Christy and Scott (1965:223) summarizes the 

 problem fairly well: 



"Two countries contemplating the same fishery may rightly 

 make different choices about the intensity and combination of 

 fishing activities .... These different valuations are ulti- 

 mately the result of the obstacles to the movement of factors 

 from one economy to another. More directly, they result from 

 differences in population, national income, and tastes. It is a 

 commonplace of the theory of comparative costs that the same 

 industry may use a different technique in each country, de- 

 pending on the structure of wages and prices in each place. But 



'This study was sponsored by the University of Miami's Sea 

 Grant Institutional Program which is part of the National Sea 

 Grant Program administered by the National Oceanic and At- 

 mospheric Administration of the U.S. Department of Commerce. 



^Present address: College of Marine Studies, University of 

 Delaware, Newark, DE 19711. 



it has never, to our knowledge, been pointed out that the ocean 

 is the main locale where these structures clash . . . .Of course, 

 it is possible to exaggerate these discrepancies. Forces outside 

 the fisheries tend to bring the national wage and price struc- 

 ture into line, through the movement of goods and the sale of 

 services. And within the fishery itself the increasing inter- 

 national trade in this equipment, all tend to press toward a 

 uniform set of labor-capital-fish price-ratios." 



The model presented will allow a more formal 

 analysis of these and other problems. 



The first section of the paper describes a one 

 country model of the economics of fisheries from a 

 general equilibrium point of view. Results identi- 

 cal to the earlier works are derived as a starting 

 point for discussion. The second section expands 

 the model to consider two nations both having 

 access to the same fish stock and describes the 

 conditions necessary for an international open- 

 access equilibrium yield, for local maximum 

 economic yields (MEY), and for a true interna- 

 tional ME Y. The third section describes the condi- 

 tions for an international MEY in more detail and 

 shows the ways in which the countries can go 

 about achieving them. Throughout the analysis is 

 static. 



Consider a country with a specified amount of 

 resources, a given technology, and exclusive use 

 (either through default or international law) of a 

 fish stock. Using its resources, it can either pro- 

 duce manufactured goods (M) or fishing effort (E) 

 which can be applied to the fish stock to catch fish. 

 Let the implicit function for the PP curve between 

 M and E be: 



Manuscript accepted May 1974. 



FISHERY BULLETIN: VOL. 73, NO. 1, 1975. 



51 



