Chapter 12: The economic sustainability paradigm and freshwater and marine fisheries governance
Water and fisheries, both common-pool resources, face similar economic resource allocation and extraction challenges: how to maximize society’s discounted net benefits from these resources while ensuring their viability? Both freshwater use and marine capture fisheries are rivalrous in the sense that one person’s extra water extracted or fish caught reduces the amount or quality available to others. Such resources face the added problem that the cost of excluding others from harvesting or extracting the resource is high. Consequently, lower-value uses of common-pool resources may continue, despite the fact that higher-value alternatives are available. As with common-pool resources, the use of private goods is rivalrous, but with private goods the ability to exclude others is straightforward and, typically, undertaken at minimal cost. Thus, with private goods, competitive markets can allocate who gets what and when, such that if someone values a private good more than someone else, she or he can purchase and consume it. In other words, with private goods, competitive markets ensure that goods are allocated on the basis of marginal willingness to pay, and all gains from trade are exhausted. The key difference for common-pool resources relative to private goods is that the cost of excluding others from harvesting or extracting is frequently substantial, such that low-value uses for a resource can continue even when higher-value alternatives exist.
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