Who Should Pay the Administrative Costs of an ITQ Fishery

Implementation and management of an ITQ fishery involves significant and costly administrative activities. These activities include formulating and implementing policy rules, monitoring and enforcement to deter illegal behavior, and economic and marine research. In this article we construct a model of a competitive ITQ system to analyze how the distribution of administrative costs between the public and a fishing industry can affect the equilibrium in the quota market, including equilibrium level of administrative costs, and derive results about the optimal distribution of these costs.