Rational Noncompliance and the Liquidation of
Northeast Groundfish Resources
By
Dennis M. King, PhD
University of Marylanda
and
Jon G. Sutinen, PhD
University of Rhode Islandb
Marine Policy, Elsevier Press, Published online June 2009
doi:10.1016/j.marpol.2009.04.023, http://www.sciencedirect.com/science/journal/0308597X
aCorresponding Author: University of Maryland Center for Environmental Science, Chesapeake Biological Laboratory, P.O. Box 38, Solomons, MD 20688, USA. dking@cbl.umces.edu. Phone: 1-410-326-7212. Fax: 1-410-326-7419.
bDepartment of Environmental and Natural Resource Economics, 1 Greenhouse Road, Kingston, RI 02881, USA. jgsutinen@gmail.com. Phone: 1-510-235-9235.

Abstract

The results of a 2007 survey of fishers, managers, scientists, and enforcement officials indicate that noncompliance is a significant problem in the Northeast multispecies groundfish (NEGF) fishery, as it has been for at least 20 years. The percent of total harvest taken illegally is estimated to be 12% to 24%, which is significantly higher than estimates of 6% to 14% in the 1980s. Thirty-seven percent of fishers, 61% of fishery managers and 80% of fishery enforcement staff believe that "the combined adverse impact of all violations on the health and manageability of fish resources" is significant, highly significant, or extremely significant. Many fishers believe that illegal fishing will prevent them from ever benefiting from stock rebuilding programs.

The deterrence effect of the existing enforcement system in the NEGF fishery is weak because economic gains from violating fishing regulations are nearly 5 times the economic value of expected penalties. For example, by fishing illegally a midsize trawler in the NEGF fishery is estimated to increase expected earnings per trip by $5,500. Fishing violations have a 32.5% probability of being detected, and enforcement data show that a detected violation has a 33.1% probability of being prosecuted and resulting in a penalty. The average penalty assessed for a violation is $20,455 and the settlement amount averages 53% of the assessed penalty. The expected cost of a violation, therefore, is $1,166. When compared with the illegal gain, the economic incentive not to comply is $4,334 per trip.

Normative factors, such as moral obligation and peer and community pressure often induce fishers to be law-abiding despite potential illegal gains. However, normative factors favoring compliance in the NEGF fishery are weak because many fishers believe recent fishery management decisions were not justified and that planned stock rebuilding targets and schedules are arbitrary and unfair. Until this situation changes, more enforcement and more certain and meaningful penalties will be needed to improve compliance. Fishing restrictions will need to be tightened to achieve new legally mandated stock rebuilding targets. This will increase economic incentives for noncompliance in the fishery and require even more enforcement and more significant penalties to achieve adequate compliance rates.

This article recommends that a "smart compliance policy" be implemented in the NEGF fishery that employs different types of enforcement strategies and penalties with different groups of fishers identified based on their compliance histories. This should include aggressive targeting of frequent violators and criminal penalties and the forfeiture of all fishing privileges for certain types of violations. Funds should be redirected toward incentive programs to support collaborations between other fishers and enforcement staff to increase the number of violations that are detected, reported, and successfully prosecuted.