20


the marginal product of effort (VMPE) with its marginal (average) cost,

r. To demonstrate how the common property nature of an unregulated

fishery encourages non-optimal levels of effort, Gordon (1954) analyzes

a fishery which is composed of two grounds of different productivity or

location and constant product price. Figure 4 depicts this situation.



 $ a $ b




 r \ r
 VMP VAP1 VMP2 j\VAP2
 SI Effort Efor
 0 E1 E Effort 0 E2 E E2 Effort


 Ground 1 Ground 2


 Figure 4. Allocation of fishing effort between fishing
 grounds of different productivity or location


 The optimum degree of utilization of the fishery will, according

 to Gordon, occur with OE1 units of effort being used on Ground 1 and OE2

 units of effort on Ground 2. Under this allocation of effort, each

 ground yields a rent corresponding to the shaded areas. This pattern of
 fishing, however, does not represent a stable position for the fishery.

 The reason for this instability relates to the lack of property rights

 on any given fishing ground. Fishermen venturing from port are inter-

 ested in grounds with the highest average productivity. Given the

 constant marginal cost of effort, this is where the fisherman will