Subsidies, decommissioning schemes, and their implications for effective fisheries management

There is general agreement that many, if not most, fisheries subsidies are detrimental to effective resource management. There is not, however, general agreement about subsidies used for decommissioning or buyback purposes. One school of thought argues that such subsidies can have a positive impact upon resource management, by removing excess fleet capacity from the fisheries. An opposing school of thought criticizes the use of these subsidies on the grounds that the subsidies are, by and in the large, ineffective. This paper argues that decommissioning or buyback subsidies can have a positive impact upon resource management, but only if they are wholly unanticipated by the fishing industry. If, on the other hand, the subsidies are anticipated by the industry, the subsidies can have a decidedly negative impact, intensifying both economic waste in the fisheries and overexploitation of the fishery resources.