Fisheries involve some of the knottiest questions in natural resource allocation. When you add in issues of the rights of aboriginal peoples things get even more complicated.
That is a short answer to a query about the economics involved in perennial skirmishing over Lake Mille Lacs. The latest manifestation of that was a protest over state-imposed fishing limits last weekend during a Gov. Mark Dayton bass fishing photo op. There are no neat answers but one can explore some possible insights.
Start with Nobelist Ronald Coase. He argued that for economic resources to be used efficiently, it is critical that property rights be defined very clearly. Further, the need for consensus on these definitions is actually more important than the rules themselves. An analogy would be whether the toilet seat should be left up or down; more important than the rule itself is that it must be clearly understood and followed by everyone in the household.
Most economists accept that Coase is correct, at least in the abstract. And the property rights regarding fishing on Mille Lacs are messy and unclear to say the very least. So from the get-go, any outcome is bound to be fraught with problems.
Part of the messiness stems from the fact that when our government took much of Minnesota from the Native American tribes who owned it, it gave them a piece of paper guaranteeing them certain hunting and fishing rights in perpetuity. As with most treaties signed with Indian tribes, the promises made were quickly reneged on. But after decades, the Mille Lacs Band of Chippewa were able to confirm their treaty fishing rights in Federal Court in the 1990s. This includes netting or spearing during a spring season. (For a good summary, click on “Minnesota Issues Resource Guides Indian Fishing and Hunting Rights”)
Those resource guides conflicted with the assumed rights of thousands of non-Native American sports fishers and owners of resorts, based on decades of practice in which the treaty rights had been ignored. The Minnesota Department of Natural Resources has to administer a management system that accommodates native rights, the desires of fishing enthusiasts and the long-held interests of resorts that make a business from the resources of this large lake.
And then there are the interests of people like me, Minnesota citizens who do not fish for walleye but who nevertheless have an interest in the preservation of our commonly held public resources for ourselves and for future generations. These interests overlap to a degree with the more-directly-involved parties, but not completely.
The concept of “commonly held” brings us to another economic topic, that of the management of common-pool resources.
Many people are familiar with “The Tragedy of the Commons,” a widely-read but tragically flawed 1968 essay by ecologist Garrett Hardin. He argued that when there are no limits to use of a common-pool resource, the inevitable result is overuse and eventual destruction of the resource itself. The argument also had been made in formal terms by economist H. Scott Gordon in 1954.
The basic argument was correct. The error was to confuse an open-access resource with “the commons.” A commons was a traditional fishing or grazing area owned and controlled by a village or tribe. These were not open access. Whatever group owned the commons set the rules and there are myriad examples of such common property that has been sustainably managed by groups for centuries.
Hardin argued that the only solution for any common pool resource was privatization so that individuals had title to sub-portions of any such resource. He believed these could be managed sustainably only if there was “mutual coercion, mutually agreed upon.” He ignored the fact that that exact situation did, in fact, exist for thousands of fisheries, forests, grazing lands, irrigation systems and other common-pool resources worldwide. These did not need privatization down to individuals to achieve efficiency.
It took decades of work by economists, political scientists and others to correct this mistake. One of them, Elinor Ostrom, got the 2009 Nobel Prize in Economics for her work demonstrating that, under certain conditions, groups can be the most efficient managers of common pool resources and that unthinking efforts to privatize can harm society.
Native Americans did manage many resources without individual ownership and did so sustainably. Yes, their populations were small relative to the resources available, especially after the enormous human mortality caused by the introduction of European diseases. But they did practice the ”mutual coercion, mutually agreed upon” prescribed by Hardin.
The lake and surrounding land was wrested from them by the whites. Initially, the lake was treated as an open access resource, with no limits on fishing. But as population grew, Minnesota, along with other states, instituted hunting and fishing regulation. That applied to everyone, including Native Americans, until the Mille Lacs band succeeded in reestablishing its treaty rights.
The DNR has to administer the awkward compromise that exists. Fish populations are hard to determine with great precision. The dynamics of how they change in response to myriad factors are complex. So the DNR has a thankless job. For this year, their decision was to allow only catch and release of walleye with a three-week ban even on that. This ends July 28.
Resort owners and others protested current policy, arguing that the DNR’s counts are off and that more fish are available. I’m no biologist and have to go with the DNR. Over the decades I followed natural resource econ issues, there have been many examples of fishing interests insisting the biologists were wrong right up to the collapse of the fishery.
Economist Coase argued that once rules were clear, contending parties could negotiate with each other to reach agreements that best satisfied their needs. That happened after the initial 1990 lawsuit was filed. The DNR reached an agreement with the band that included a lump sum payment and narrowly defined fishing rights. Coase would have beamed. But the 1993 Legislature refused to approve the agreement and it never was implemented. Subsequent federal court decisions gave the tribe more than it had accepted in the draft agreement.
It is an issue that is not going to go away, but the economics will remain instructive for other situations where we need to manage resources as a group.