mix of all factors including purely adminis- 

 trative considerations. 



The attack within the profession has raised 

 an appropriate question about the implica- 

 tions of limits on entry for Pareto optimiza- 

 tion. Another position also has been advanced 

 based on an assumption questioned through- 

 out this paper that the maximum physical 

 yield is so fundamentally sound in the oper- 

 ational sense that its utility as a tool out- 

 weighs its defects.'-'' 



In the competitive model there is no limit 

 on entry beyond that provided by what Knight 

 has called the "social function of ownership." 

 In the fishery with the resource being common 

 property the objective of the economist in 

 calling for a limit on entry is to provide the 

 ownership function while retaining the Pareto 

 optimum conditions inherent in the competi- 

 tive model. 



Two questions may be raised about this 

 goal and the procedures necessary to achieve 

 it. Will the barriers to entry result in a situ- 

 ation that goes beyond competition, i.e., does 

 the creation of property rights just restore 

 the conditions that would be found with pri- 

 vate property operating under competition 

 or does it also imply the creation of monopoly 

 power so that buying and selling is no longer 

 on a competitive basis? The second question 

 is an integral part of the first. Does the estab- 

 lishment of barriers to entry and the subse- 

 quent economic regulation of the fishery in 

 the public interest require the creation of a 

 regulatory mechanism so costly and complex 

 as to be self defeating? ^-^ 



Economic theory does not provide an 



^3 See WantiTjp (1970, p. 18); "While ma.ximum sus- 

 tainable yield constitutes a relevant, operational, and 

 noncontroversial objective of conservation policy, this 

 is quite different for the objective of 'maximum net 

 economic yield' — even if its realization through 

 limitation of entry could be agreed upon by the fishing 

 industry." Also (Wantrup, 1962, p. 292): "My approach, 

 therefore, would be set more modest regulation goals 

 which would concern themselves more with the re- 

 source base than with rent. We are dealing then 

 with matters we can measure. If we try to maximize 

 rent as a policy goal, then we get into an area where 

 I for one would put out a 'caveat' sign." 



'* Virtually the entire literature on the economics 

 of fisheries has commented on these two questions 

 albeit in a not very satisfactory manner. For the 

 details on control plans to limit entry see Sinclair 

 (1962) and Royce et al. ( 1963). 



answer to these questions. It is possible, how- 

 ever, based on experience with the social con- 

 trol of industry, to advance certain tentative 

 hypotheses. No control mechanism based solely 

 on biological considerations is workable in 

 the long run in the face of economic and 

 other pressures. Therefore, the cost of the 

 control mechanism is ultimately a joint bio- 

 economic cost. Even in these circumstances 

 it may be that the costs of control are dis- 

 proportionately large relative to the value of 

 the resource left unprotected.^'^ 



A second hypothesis is that if the cost of 

 bioeconomic control is not excessive then the 

 capacity to regulate the fishery in the public 

 interest, i.e., to preserve the stock and prevent 

 the emergence of significant monopoly power, 

 is well within the power of regulatorj- pro- 

 cesses and tax arrangements that have proved 

 themselves workable in other circumstances. 



APPROACHES TO FISHERIES 

 MANAGEMENT 



A major constraint in the development of 

 a consistent monetary policy is that the mone- 

 tary system itself is continuously evolving. 

 The analogy seems applicable to regulatory 

 problems involving ocean resources. The pat- 

 tern of resource exploitation in the oceans 

 and the law of the sea are changing rapidly. 

 In addition, military uses of the oceans, while 

 not a new phenomenon, are being transformed 

 and at the same time the very existence of 

 the ocean in the way we have known it is 

 threatened by the effects of the population ex- 

 plosion and the rising level of real income. 

 Furthermore, our capacity to deal effectively 

 with ocean living resource problems is limited 

 by the inadequacy of our scientific knowledge 

 of life processes in the ocean, the generally 

 weak economic condition of fisheries, and the 

 nationalistic interests involved. 



It is beyond the scope of this paper to go 

 into these structural questions. It is clear, 

 however, that in the future the organizations 

 by which fisheries are to be regulated must 

 be prepared to negotiate the basic issues of 

 control of the environment and the priorities 



2^ It might be desirable to protect the resource for 

 other reasons, i.e., because it was unique, etc. 



20 



