Scandinavian Working Papers in Economics

Working Papers in Economics,
University of Gothenburg, Department of Economics

No 152: Potential Rent and Overcapacity in the Swedish Baltic Sea Trawl Fishery

Håkan Eggert () and Ragnar Tveterås
Additional contact information
Håkan Eggert: Department of Economics, School of Economics and Commercial Law, Göteborg University, Postal: Box 640, SE 40530 GÖTEBORG
Ragnar Tveterås: Stavanger University, Postal: P.O. Box 8002, N-4068 Stavanger, Norway

Abstract: Many EU fisheries have problems with depleted stocks and fleet overcapacity following from regulated open access regimes. Some EU countries have introduced Individual Vessel Quotas (IVQs), which can stop the race to catch and provide the fishers with incentives to minimize costs for a given catch. We model an IVQ fishery using a cost function approach and apply the methodology to the Swedish cod fishery in the Baltic Sea. We estimate a translog cost function for a data set of Swedish trawlers and assess the potential gains from a structural adjustment of the fleet. Results suggest potential cost savings of SEK 140 millions and a desirable fleet reduction of 25% for the Swedish Baltic Sea cod fishery.

Keywords: cost function; efficiency gains; individual vessel quotas; Swedish fisheries

JEL-codes: D24; Q22

26 pages, December 10, 2004

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Published as
Håkan Eggert and Ragnar Tveterås, (2007), 'Potential Rent and Overcapacity in the Swedish Baltic Sea Trawl Fishery', ICES Journal of Marine Science, vol 64, no 3, pages 439-445

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