Working Paper: NBER ID: w17019
Authors: Corbett A. Grainger; Christopher Costello
Abstract: Property rights are commonly touted as a solution to common pool resource problems. But in practice the security of these property rights varies substantially owing to differences in design. In fisheries, the design of individual transferable quotas (ITQs) varies widely; the consequences of these design differences on economic outcomes has not been studied. To test whether the security of these property rights affects asset values, we compile a unique dataset to examine the relationship between the exclusivity of property rights and the dividend price ratios for ITQs. We find evidence that stronger property rights lead to higher asset values and lower dividend price ratios in ITQ fisheries. This pecuniary effect of property rights security informs the current policy debate on the design of property rights institutions for managing natural resources.
Keywords: No keywords provided
JEL Codes: G12; P14; Q2; Q22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| stronger property rights (P14) | higher asset values (G32) |
| stronger property rights (P14) | lower dividend price ratios (G35) |
| higher illegal harvest rates or migratory species (Q27) | weaker perceived security of property rights (P14) |
| weaker perceived security of property rights (P14) | higher dividend price ratios (G35) |
| policy shock related to quota buybacks (C54) | altered perceptions of property rights security (P14) |
| altered perceptions of property rights security (P14) | affected asset values (G32) |
| weaker property rights security (P14) | higher implicit discount rate (E43) |