Managing international open access resources: Empirical evidence from the International Whaling Commission

The International Whaling Commission (IWC), founded following World War II to regulate the use of the world's stocks of whales, was one of the earliest attempts at international management of an open access resource. The first chapter describes the founding of the IWC which was to regulate the whaling industry by setting overall catch quotas. It is found that the least efficient of the whaling nations objected to any attempt to lower the quotas. Because the IWC could not force a country to accept lower quotas, it could not prevent the excessive depletion of the whale stocks. The chapter ends with a discussion of the moratorium on commercial whaling and the use by the United States of economic sanctions to enforce the moratorium.;Chapter two develops a bioeconomic model of the whaling industry under open access and optimal management from which a test for the effectiveness of the IWC's regulation is derived. Essentially, the test measures the weight given to future harvests by the IWC in setting the quotas. Using data on harvests, stocks, effort, prices, and costs, the model is estimated using the Generalized Method of Moments procedure. It reveals that the IWC placed little or no weight on the future harvests. In other words, the actual harvests that occurred under the IWC's management differed little from what would have occurred had the IWC not existed.;In the third chapter, the data and parameter estimates from the second chapter are used to simulate what the harvests would have been under optimal management, the IWC failed to lower the quotas fast enough and far enough to remain on the optimal path. Mismanagement of the whaling resources resulted in the whale stock being reduced to a level almost half that of the optimal stock size and a sustainable harvest from this reduced stock one third lower than the optimal harvest. However it required more than twice the effort to catch this smaller harvest.