Regional fisheries management organisation with an endogenous minimum participation level for cooperation in straddling stock fisheries

This paper examines the effect of establishing a regional fishery management organisation (RFMO) with an endogenous minimum participation level on cooperative possibilities in straddling stock fisheries within the Cournot game in both cases – costless and costly enforcement for compliance of RFMO's members. The minimum participation level for the existence of an RFMO is unanimously chosen by fishing countries when negotiating the establishment of the RFMO. The result shows that an increase in cooperation level leads to an increase with an increasing rate in both steady-state fish stock and total rent of the fishery. The equilibrium of the minimum participation level is at the smallest cooperative level for a profitable coalition. If an RFMO with an endogenous minimum participation level is established, the RFMO is stable at the equilibrium of the minimum participation level. Furthermore, an RFMO that requires costly enforcement typically involves a greater cooperative level at the equilibrium of the minimum participation level than an RFMO that could be enforced without cost. Consequently, if an RFMO forms with an endogenous minimum participation level in the case of costly enforcement, it not only results in a higher level of steady-state fish stock, but it also may improve the rent of a participant. Finally, the bio-economic parameters and the number of countries involved in straddling stock fisheries have a significant effect on circumstances under which an RFMO with costly enforcement becomes worthwhile.