That’s all I’m going to say about the 100 cod story

I know, a lot has been said already about the nonsensical story that there is only 100 cod left, but there is one thing I hadn’t even noticed back then. The Telegraph gave its article the following title:

Just 100 cod left in North Sea

Then the subtitle said:

Overfishing has left fewer than 100 adult cod in the North Sea, it was reported.

This is different than “100 cod” – not all are adult. Perhaps the author changed his or her mind as he/she went along writing the article. Perhaps by fewer than 100 adults he/she meant to say something like 98 adults, which leaves 2 juveniles… Nevermind. The caption under the figure in the article said:

Not a single cod aged over 13 was caught in the North Sea last year.

Most cod is mature before the age of six.

Should one species be allowed to choke a fishery?

The North Sea bottom trawl fishery is a typical multispecies fishery. A single haul catches many different species, including plaice, sole, cod, turbot, red mullet, tub gurnard, and monk fish. These species tend to associate with other species instead of swimming together in schools, so it is almost impossible to catch one species without also catching a lot of others. Fisheries scientists like to call this a technical interaction between the species: they interact not through predation or competition, but through ending up in the same net.

If a bottom trawl fisher runs out of cod quota he can do three things: buy additional cod quota from other fishers, stop fishing, or keep on fishing but throw all cod that he catches back into the sea (which is what we call discarding of fish). So if this fisher is not allowed to discard his cod catch, and there is nobody who can sell him any cod quota, he is forced to stop fishing altogether. Cod is then called the ‘choke species’: the species that stops you from fishing when its quota runs out. If you were allowed to discard fish you would continue fishing as long as there is at least one species that can still be caught. As far as I know there is no term for this sort of species, but I kind of like the term slack species.

The EU is about to introduce a ban on discarding, and to set TAC (Total Allowable Catch) levels for a number of species whose catch has so far been unrestricted (for instance red mullet, brill, and sea bass). Unsurprisingly, fishers are adamantly opposed. To them ‘more species under a TAC regime’ means ‘more potential choke species’. They prefer fisheries policy to regard a few major species only, and to accept the bycatch of all other species.

MSY is flawed in two ways…

I admit that my first reaction was something like “oh, so these guys just want the right to fish a species to extinction if it suits them”. But on second thought they point towards two flaws in the principle of Maximum Sustainable Yield (MSY), which is currently the guiding principle in fisheries policy worldwide. MSY is the largest possible annual catch you can get sustainably. If a stock is never fished, it is at its maximum possible size, but you don’t catch anything. If you fish a little every year, the stock will be a bit smaller, and you catch a little bit every year. Fish some more, and the stock will be somewhat smaller while your catches are larger. As you keep on intensifying your fishing, however, you reach a point where not only the stock declines but also your catch. The maximum catch you can have every year without depleting the stock is called MSY.

The first problem with MSY is that it is based solely on biological principles. Economists have long argued for Maximum Economic Yield to be the guiding principle: this is the annual catch that maximizes, in a sustainable manner, the total revenues minus the total costs from fishing. MEY means that you take into account not only biological growth, but also the costs of fishing and the price of the fish. In the simple text book models this actually means fishing a bit less than under MSY to take advantage of the fact that more abundant fish is easier, and hence cheaper, to catch.

Second, the principle of MSY does not only ignore costs and prices, but also technical interactions. If you took these into account, a policy that maximizes the sum of the MEY over all species would allow fishers to overfish some species, and to underfish others. Mind you: ‘overfishing’ does not necessarily mean depleting a fish stock. It simply means that fishing pressure is higher than the fishing pressure that would lead to MSY. So you can sustainably overfish a stock! It’s just that in general you shouldn’t do that, because it gives you less fish under higher costs than you would have under MSY. In a multispecies fishery, however, it may be more efficient to overfish some species because that would allow more catch of other species that are more valuable, more productive, or both.

Note that trading quota could relieve some of the pain, but not all. If cod quota are very low compared to other quota, cod will eventually become a choke species, trade or no trade.

…but what is the alternative?

Ideally TACs should be set taking technical interactions into account. Fisheries biologists are working on this problem, but I suspect that it remains a very complex issue. On the other hand, current TACs are certainly not realistic in multispecies fisheries, so any consideration of technical interactions would be welcome.

Then there is the issue of discarding: the EU can either allow fishers to discard unwanted catch, as has been the policy so far, or ban discards, as the EU is about to do. In theory, if discards are allowed, fishers can keep on fishing as long as there is a ‘slack species’. It sounds horrible that fishers go on fishing, throwing over board everything they don’t need, but be aware that not all discarded catch is dead or dying, although the survival rate can be very small. A discard ban will have the advantage that the researchers who do stock assessments have better catch data, because so far they had only very crude estimates of how much fish were discarded. This matters, because stock assessments lean heavily on landings data, which underestimates catch if part of the catch is discarded. On a longer term a discard ban may also give a strong incentive to develop more selective fishing technologies, although it is highly unlikely that bottom trawling will ever be 100% selective.

Additionally, perhaps the current system of catch quota could be complemented with the possibility to rent additional quota from the government for, say, the first few choke species. Under such a policy you would indeed catch a bit more of the choke species and a bit less of the slack species, because catching all species would become too expensive. The rental price would still give an incentive to fish more selectively, but the fishery would not be shut down completely as soon as the choke species quota run out. The problem, of course, is setting the right prices: they should reflect the value of the loss of future catches of the choke species, which depends not only on biological growth, but also on the price of the choke species, the costs of catching it, and the discount rate. A daunting task indeed.

My highlights from EAERE 2012

My highlights from the 19th annual conference of the European Association of Environmental and Resource Economists:

  • I was surprised to see how crude estimates of travel costs still are in non-market valuations of recreational sites;
  • Also, how few of those studies have done a proper qualitative analysis before they do their quantitative study;
  • Linda Nøstbakken had a very nice paper on how a combination of diversified monitoring and self-reporting incentives can greatly enhance monitoring of fisheries legislation;
  • Martin Quaas proposed using a “shadow interest rate” as a way of expressing the quality of fisheries management;
  • Nick Hanley is a Les Paul man:

And rightly so; Fender people are evil.

Living Planet Report (1): Living Planet Index paints a bleak picture, but be careful with your interpretation

WWF’s latest Living Planet Report presents a bleak picture, some hopeful trends, an awfully bad indicator and lots of pious words on sustainable development.

The Living Planet Index

The bleak picture is painted by the overall trends in The Living Planet Index, a weighted average of the abundance (or density, or another indicator of well-being) of a ‘basket’ of species. You can argue about the weights each species gets, of course, but the overall message is that most of the species they monitor are still in decline.

The hopeful trends are in the North: rich country LPIs are rising. There could be many reasons for this. Unsurprisingly, the LPR claims that the rising trends in the North are only possible because rich countries ‘export’, as it were, the damaging activities necessary for their consumption to poorer countries. I don’t doubt this is one of the drivers, but I can’t help thinking that it also matters that as we grow richer, we start caring more for the environment. Whether this means that we should all be poor (little consumption of natural resources) or rich (high preference for conservation) is a very, very old discussion in environmental economics.

The LPR also states that just because things are getting better, that does not mean they are going well. The report rightly points towards the fact that Atlantic cod stocks in some places are only a few percent of what they were mid-nineteenth century. Although cods stocks are improving, they could have been a lot better (i.e., we could have had a lot more bacalau than we’re having now). Be careful, however, not to interpret this as that we should strive for pre-industrial levels for all species. After all, this would mean that we should never fish at all. The report does not make this claim explicitly, but such claims are made in other indicators. It is important to keep in mind that biomass levels that give us Maximum Sustainable Yield generally lie at about 20%-50% of what the biomass would have been if we did not fish at all. So if a stock is at 5% of its pre-fishing level it could be at about 10% of its optimal size. Always keep in mind: what do we want? Pre-industrial or even pre-human biomass levels are poor benchmarks for that.

Next post: Oh boy. They’re using the Ecological Footprint

A day on Urk

Fishing is not a big part of the Dutch economy: its gross added value is less than a percent of Dutch GDP. But it appeals to the Dutch psyche. One of the most iconic species in this respect is herring: the Dutch have a strange pride in eating it raw, holding it by its tail. One of the most important traded goods in the days of the Hanseatic League, it made some traders in towns like Deventer filthy rich. Alas, nowadays the herring fishery is dominated by the Norwegians.

But go to any market in a Dutch town and you will find a stall with the essential raw herring, kibbelingen (originally fried cod cheeks, but it can be any fish species nowadays – a lot of Dutch people think it’s a species of its own) or other seafood. And where better to eat your fish than at the Visserijdagen on Urk?

That’s right: on Urk – it’s a former island that is now a town in the Flevopolder. It’s a fascinating place. When the Dutch built the Afsluitdijk and the Zuiderzee became the IJssel Lake, the Urkers simply refused to go the same way as towns like Elburg and Spakenburg, where the old Zuiderzee fishery is no more than folklore. Instead, they moved their efforts to the North Sea and continue to have a thriving fishing community to this day. It’s by far the Netherlands’ biggest fishing community and auction, but most of the Urk fishing fleet lies more than an hour’s drive away in the Frisian town of Harlingen.

Like most of the Dutch fishing fleet, the Urk fishery is mostly focused on flatfish like plaice and sole, which they catch by bottom trawlers. As far as I can judge these species are fairly well-managed, although the sector has its share of problems including high fuel prices and growing criticism from environmental organisations at the impact of fishing on the benthic ecosystem. The fuel use and benthic impact go hand in hand: so far the most widely used fishing gear is the beam trawl, which is a fairly heavy piece of equipment that includes so-called tickler chains to stir up the flatfish. It takes a lot of energy to drive the beam trawl over the sea bottom, and biologists argue that it also affects many other species. Therefore, fishers and researchers are currently doing a lot of technical research on alternative gear with lower fuel use and benthic impact. One of these is the pulse trawl, which sends light electrical pulses that have the same effect as the tickler chains on flatfish, but have a much smaller impact on the sea bottom. They had one of those displayed in the harbour.

A day like this attracts a lot of people, and I’m sure the weather helped. Or maybe it was the free bag of fish: this is The Netherlands, after all.

Religion, academics, and fisheries policy

I once explained to a non-Dutch economist how religion affects Dutch fisheries policy and she could hardly believe me. Here is a post from a fisherman from Urk, The Netherlands’ biggest fishing community, that perfectly illustrates how deep this impact goes, and how it complicates fisheries policy.

If you can’t read Dutch, let me translate the gist of the piece (hyperlinks added for clarification):

Last Monday we were fishing on the East side of the Cleaver Bank. This is one of the areas our green friends of Greenpeace claim is an important nature reserve, making their point by dumping a bunch of stones. Catches were great until the wind turned and our catch suddenly reduced to about half of what we were catching. I’ve seen this happening before, and I used to ask older fishers: “The fish has to be somewhere, right? It can’t just disappear, can it?” And all they could answer was that they just did not know. It makes you wonder who we think we are to think we can exert any influence on the fish. You won’t convince me that we, with our small boats, are capable of destroying the entire sea bottom as so many folks say we do.

Nature is so great, it does not care about what we do, it goes its own way and the way planned by its Creator. Man’s activities could change that a bit on the short term but it will not establish real change. There is fish, or there is no fish, but where it comes from or where it goes nobody knows. There have been bad times and there have been good times. You can’t express it in some graph that needs to be interpreted so that some policy can be implemented. You can’t confine Nature in little boxes such as the Plaice Box. It is impossible to understand Nature, and more difficult to predict than the weather.

We can do our job every week in that Creation, to enjoy its diversity, to which we sometimes pay too little attention. Our sights are obscured by our everyday financial troubles but all the while we can enjoy the greatest masterpiece of all times, God’s Nature.

We can run all the models we like, do all the estimations we like, but any attempt to limit catch or fishing effort will at best be grudgingly accepted by somebody with this world view.

So who’s right? I’m tempted to side with the biologists and to say they should try better at convincing the fishers, but I won’t, for two reasons. First, I find that a paternalist approach that can only antagonize people, and one of things most lacking in fisheries policy is mutual trust. Second, even the biologists themselves admit they don’t know everything so I think a two-way communication would be much more helpful. Yes, we might learn a thing or two from the fishers.

Fisheries policy has all the ingredients of a policy maker’s nightmare. Like climate policy, fisheries management is dazzlingly complex, with a lot of unknowns. The Plaice Box was established to protect juvenile plaice, thereby improving the entire flatfish fisheries. The fishers hated it and did not expect any good from it. Ever since its establishment, its stocks of juvenile plaice have declined! The biologists are still in the dark why, but the fishers feel vindicated.

Moreover, there is a huge gap in world view and education between the sector (religious, vocational training) and the researchers (secular, PhD). I know of nobody who ever crossed that rift. In Wageningen you meet many academics who come from a non-academic background: many of my colleagues and students were born and raised on a farm, and I myself was born right above my father’s butchery. I think a lot of agricultural policy would not have been possible without people who knew both worlds. But I have never met any student in, say, animal husbandry, biology, or marine resource management whose father went out on a fishing vessel every week.

Lastly, there are institutional problems, and history has not been helpful here. Fish stocks have been a free-for-all for centuries, with all the known commons problems, but also establishing a sense of entitlement among fishers. It is their fish, it is their fishing area. Sadly, the moral entitlement has not been joined by a legal one: a farmer may own land, but a fisher has no legal tenure over any area in the North Sea. So legally the government can designate huge no-take zones without having to compensate anybody, but doing that on land involves huge costs in buying land or compensating people.

Man, I love my job (had a nice raw herring with onions yesterday).

Seeing red about diesel

It’s just unbelievable. VVD (sort-of-libertarian), CDA (christian centrist) and PVV (right-wing populist) just spent weeks haggling over a new budget. Finally the whole thing blew up, we’re getting new elections in September, but in the meantime CDA and VVD managed to agree with a bunch of other parties, including the Green Left (yes, that’s their name) and the sort-of-liberal D66, within 48 hours. Was it really that easy? What have they been doing in those past weeks?

Anyway, part of the deal is a tax increase on so-called ‘red diesel’, i.e. diesel with a lower tax rate than regular diesel. It is only allowed in such machines as tractors, road maintenance equipment – and all non-recreational ships. No wonder Dutch fishers are up in arms. Fuel is one of the major expenses of Dutch bottom trawlers.

I hate to say this, but as an economist I don’t see a reason to exempt any economic sector from a tax, let alone a tax on fossil fuels. If farmers and fishers pay a lower tax rate, why not trucks? Or salesmen? As we’re on it, why not abolish the tax altogether? Oh wait – there’s state coffers to fill and negative externalities to tax. But in any case, I think we should have a level playing field for all, and that includes a similar tax rate for all.

Illegally obtained evidence in whaling research?

Apparently some biology journals refuse to publish research on whales if data for that research come from commercial whaling, as this paper in the ICES journal describes. Frankly the authors (all from a Norwegian research institute) are not happy with that.

I am no legal expert so I don’t know whether such research is a case of illegally or improperly obtained evidence. I understand why such evidence is not accepted in court: you don’t want to encourage police officers breaking the law themselves to catch a criminal. By the same token, you don’t want to encourage researchers breaking international treaties for their research.

Nevertheless, I have mixed feelings about the international whaling bans. I once made this picture on the Bergen Fish Market:

Yes, I tried whale meat. It’s not exactly a delicacy. I also asked what species it was and they told me it was minke whale. If you check minke whale in the IUCN Red List you will find the species is not threatened in any way. But what about the species next to the whale meat? There are many different eel species, but the eel you buy in most shops is European Eel – critically endangered, according to the IUCN Red List.

Why do we eat eel, which is on the brink of extinction, while we get so upset about minke whale, which is so abundant? I admit: smoked eel tastes much better than whale meat.