Net losses: solving fishing’s sustainability crisis

With respect to the UK’s fisheries, the Rt Hon Michael Gove MP spared no time at all in flexing his muscles as the new Environment Secretary. Just weeks into his brief, Britain’s withdrawal from the London Fisheries Convention had been triggered, in a move which Gove argued would lead to a “more competitive, profitable and sustainable industry”. Specifically, it paves the way for the UK to manage its own fishing quotas, as well as deciding who gets to access British waters. Done properly, this could result in huge gains for the natural environment.

Fisheries are an example of a common pool resource – whereby access to a resource is open to all. Coupled with rational individual actors, common pool resources rarely experience sustainability. In the absence of regulation, such resources will be perpetually exploited, until, eventually, they collapse entirely. This fact has long been understood, from economists-come-ecologists such as William Forster Lloyd, Elinor Ostrom, and perhaps most famously of all, Garrett Hardin, with his eminent 1968 paper The Tragedy of the Commons.

Scale of the problem

According to a report from the UN Food and Agriculture Organisation, approximately 58% of fisheries are classified as ‘fully fished’ (i.e. operating at, or close to, optimal yield levels), and a further 31% are overexploited, whereby they are fished at a biologically unsustainable level. WWF estimate that the global fishing fleet is between two to three times larger than what the oceans can realistically support. Closer to home, favourite fish species such as haddock and cod have been removed from the Good Fish Guide, a website run by the Marine Conservation Society which informs British consumers about the sustainability of various seafood species which they can expect to find at their local supermarket or fishmonger.

The problem of overfishing extends far beyond the specific species in question. Given just how intricately enmeshed marine ecosystems can be, an unnaturally rapid depletion of one species can have serious implications for many others. For instance, the unsustainable extraction of herbivorous fish from oceans can lead to elevated levels of algal growth, which in sufficient quantities can become toxic for other species which remain. Further, when essential keystone predators such as sharks and tuna are overfished, there tends to be a swelling in the numbers of fish species lower down the food chain, which can similarly knock ecosystems out of kilter.

As well as being environmentally troubling, overfishing poses obvious economic difficulties, too. Within the EU alone, it is thought that unsustainable fishing results in €3 billion of lost productivity per annum, taking an estimated 100,000 jobs along with it. Globally, the burden of declining fish stocks has fallen most heavily on the world’s poor, with estimates from the World Bank and the UN Food and Agriculture Organisation claiming that between 90% and 97% of those employed in the fishing industry – whose income is patently dependent upon reliable and plentiful fish stocks – come from developing nations.

Answers from the Arctic

Given the capricious and ever fluctuating nature of fish shoals, it may appear difficult to know where Governments can even begin to act, should they wish to implement policies to ensure that fisheries remain, or once again become, sustainable. However, that is not to say there are no antecedents whatsoever.

Perhaps the best-known example amongst environmental economists of a policy which has enjoyed success, at least relative to that of other schemes, is Iceland’s system of ‘individual transferable quotas’ (ITQs). Such quotas grant individual fishers the privilege to land a certain quantity of fish, typically by weight, within a given time frame. ITQs can also be traded, meaning that if a fisher wishes to relinquish all or part of their allowance, they can sell it to other, perhaps more efficient, players in the industry. Importantly, the amount of fish which can be extracted from the ocean will, or ought to, be set at a level which is ecologically sustainable – i.e. allows fish numbers to replenish at a rate equal to or quicker than that at which they are removed.

ITQs are seen to be better than the more rudimentary system of ‘total allowable catch’ (TAC), which simply states the amount of fish which can be extracted from the ocean by all involved, collectively. This has led to perverse and often dangerous consequences, such as ‘fishing derbies’, whereby competing fishers are effectively encouraged to recklessly race against each other to harvest as much fish as they possibly can until the TAC is exhausted.

It is true that ITQs do not offer a perfect solution to the problem of overfishing. They require strong (i.e. expensive) governmental oversight and enforcement to function properly, and the task of setting the quota still falls on fallible bureaucrats, susceptible to regulatory capture and Hayekian knowledge problems. In this respect, the tragedy of the commons could quickly become the tragedy of government failure. Indeed, there is widespread anxiety amongst the environmental and scientific community that the existing EU quotas are worryingly generous, and do little to effectively engender sustainability in fishing. 

There are also questions about how quotas ought to be allocated to fishers. Generally, they are either based on historical catch, or through an auction. The former can be contentious in the sense that it may unfairly entrench incumbent players who already enjoy a privileged place in the market. Whereas with the latter, fishers are critical of the added cost they have to bear. Nevertheless, when appropriately administered, ITQs do appear to be an intuitive way to circumvent the problem of overfishing.  


Fishing has long been an intimate part of many countries’ history. Particularly for island nations like the UK, it has often been the only genuine source of income for entire communities. It is not surprising, therefore, that many feel an innate desire to shelter fishers from what some may regard as the vicious and unfeeling realities of global market competition.

However much one may wish to help fishers, though, it is increasingly apparent that the unsustainable nature of the current system does not do so. As scientific knowledge twinned with economic understanding has advanced, it is clear that to continue as we currently are would only store up problems in the long run. ITQs have been shown to bolster fish stocks, and are certainly one possible avenue to explore on the voyage to sustainable fishing.

Eamonn Ives is a researcher at Bright Blue