Microsoft Word - SustainabilityReport_BCC.doc

Five years after the agreement broke down, both the U.S. and Canada

were near disaster. As the Canadians fished frantically in an effort to balance out

the Alaskan harvest, the coho and Chinook stocks that dominated their waters

dwindled, affecting both Canada and the Pacific Northwest states. The famous

“tragedy of the commons” was unfolding.

So both countries went back to the bargaining table. They adjusted the

harvesting limits to take a longer-term view, account for the prevalence of each

species of fish, and better protect against overfishing. In addition, the U.S. began

to indirectly compensate Canada for the extra Canadian fish caught by U.S.

fishermen. This system, which the mathematicians had recommended based on

their game theory models, allowed the two nations to balance the economic

benefits from the fish rather than balancing the number of fish harvested. This

also created greater flexibility to respond to future shifts in fish abundance or

migration patterns. The 1999 agreement has proven to be sufficiently robust that

it was re-ratified in 2005, with only minor changes.

Because of experiences like this, fishery managers have started to

recognize that it’s impossible to understand what’s really going on with fishery

agreements without game theory. The dynamics are too complex. Nevertheless,

game theory is still underutilized in fishery management. Side payments, like the

U.S. payment to Canada, are rare and usually smaller than ideal when

implemented. Every fishery represents its own game theoretic challenge, and the

rules of the game change over time as the fishing fleets of different nations rise

and fall and as international laws around fishing evolve. The contribution game

theory has to make to fishery management has only begun to be exploited.

Even within a single country, management issues are tricky and need

mathematical guidance. A nation, of course, has the power to regulate how much

fish each fisher is allowed to catch, rather than having to rely exclusively on self-

interest. The first way this was tried was by limiting the fishing season. This

backfired, though: Fishers developed faster boats and better ways to find the

fish, so as to catch as many fish as possible as fast as possible. Managers tried

limiting the number of boats, but fishers then built bigger boats. Recently,

managers have moved to giving fishers individual quotas that they can trade

among themselves, where the quota size is determined by the fish population. If