Benefits and Perils of Integrated Data Systems in Managing Sustainable Fishing Quotas

The paper examines how auditing and punishment can be employed to manage a common property resource, specifically a fishery, through a regulation scheme that involves pre-assigned multi-annual quotas. The decision to adhere to or exceed the assigned fishing quota is modeled as a two-player game. In the absence of auditing, the model yields noncompliance with the quota, known as the tragedy of the commons, which is the only Nash equilibrium of the game. With the introduction of formal enforcement, which offsets the additional profit from noncompliance, and extensive auditing through an integrated data control system, adherence to the quota becomes the only Nash equilibrium of the model. A dynamic version of this game, with logistic biomass growth and quadratic costs of harvesting, confirms that a digitized and integrated fishery control system may enhance sustainability. However, the study also highlights the potential risks associated with fishing quotas and enforcement that are not properly adjusted for the resource and are not updated as frequently as necessary.