The equity debate: distributional impacts of individual transferable quotas

The twin goals of economic efficiency and social equity often seem at odds, particularly in the debate over two marine policy approaches: firm-level regulation of inputs and outputs (“command and control”) and individual transferable quotas. This paper examines the debate over social equity in a US fishery that transitioned from command and control to individual transferable quotas-the mid-Atlantic clam fishery. The analysis draws on 17 years of data on fishing trips, vessel ownership, tradable property rights ownership, and output market shares. The results show that no segment of the industry was disproportionately adversely affected by the regulatory change; however, they also demonstrate the emergence of a new sector in the industry, which is predominantly made up of former small-scale harvesters.