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Quota Enforcement in Resource Industries: Self-Reporting and Differentiated Inspections Public Deposited

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  • Quotas or permits are frequently used in the management of renewable resources and emissions. However, in many industries there is concern about the basic effectiveness of quotas due to noncompliance. We develop an enforcement model of a quota-regulated resource and focus on a situation with significant non-compliance and exogenous constraints on fines and enforcement budget. We propose a new enforcement system based on self-reporting of excess extraction and explicit differentiation of inspection rates based on compliance history. In particular, we use state-dependent enforcement to induce firms to self-report excess extraction. We show that such system increases the effectiveness of quota management by allowing the regulator to implement a wider range of aggregate extraction targets than under traditional enforcement, while ensuring an efficient allocation of aggregate extraction. In addition, inspection costs can be reduced without reductions in welfare.
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  • Hanse, L., F. Jensen & L. Nostbakken. Quota Enforcement in Resource Industries: Self-Reporting and Differentiated Inspections. In: Visible Possibilities: The Economics of Sustainable Fisheries, Aquaculture and Seafood Trade: Proceedings of the Sixteenth Biennial Conference of the International Institute of Fisheries Economics and Trade, July 16-20, Dar es Salaam, Tanzania. Edited by Ann L. Shriver. International Institute of Fisheries Economics and Trade (IIFET), Corvallis, 2012.
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  • AQUAFISH, USAID, NEPAD Planning and Coordination Agency, Norad, The World Bank, Hyatt Regency Dar es Salaam, NAAFE, World Wildlife Fund, United Nations University Fisheries Training Programme, ICEIDA, JICA, JIFRS, The European Association of Fisheries Economists, International Seafood Sustainability Foundation
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  • description.provenance : Approved for entry into archive by Janet Webster(janet.webster@oregonstate.edu) on 2014-02-24T17:12:34Z (GMT) No. of bitstreams: 1 Nostbakken-134.pdf: 12816 bytes, checksum: 9e86e64f02967f8d9498d8f0fe3d8175 (MD5)
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  • description.provenance : Made available in DSpace on 2014-02-24T17:12:34Z (GMT). No. of bitstreams: 1 Nostbakken-134.pdf: 12816 bytes, checksum: 9e86e64f02967f8d9498d8f0fe3d8175 (MD5) Previous issue date: 2012

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