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Group 2
Article 2: Shark Sanctuary Created in Palau
http://www.cbc.ca/technology/story/2009/09/25/tech-ecology-palau-shark-sanctuary.html
Summary
The Pacific nation of Palau created the world's first shark sanctuary. The sanctuary encompasses includes all of Palau's national waters and also it's Extended Economic Zone (EEZ). The sanctuary is 621,600 square kms (almost as big as Alberta) but will only be patrolled with one boat. Shark fishing has grown increasingly popular in the last 20-30 years due to an increased demand for shark fin soup in Asia; shark fin soup is considered a delicacy and also displays one's wealth. There are 135 species of sharks and rays that live inside the sanctuary considered endangered or vulnerable.
Shark Fisheries as an Open Resource
As in all fisheries, the main problem here is going to be restricting access to the sharks in order to stop people catching them. One of the most important forces that determine the position of market demand is tastes. For the shark fishing market, shark fin is usually the process of cutting a fin off a shark to meet demand for shark fin soup; however, sharks are also fished for other uses such as traditional medicines. Even though the fins do not have any taste, they are a sought-after commodity for shark fin soup, which is a delicacy in Asian cultures and a symbol of wealth. This is the main cause of overfishing of shark. As we know, many vessels fish Palau's waters for shark due to this high demand of shark fin.
Much like the salmon fisheries discussed in the last article, the world shark fishery has been depleted by unsustainable harvesting. Shark fishing is an extreme example of people only looking at their private costs, not the total cost of their actions. Shark finning is the practice of catching a shark, cutting off its fin and throwing the carcass overboard. This is extremely wasteful but the harvesters are simply thinking of the maximum money they can earn per fishing trip. No consideration is made to the impact of killing these top-chain predators and the damages done to the ecosystem. In recent years the demand curve has shifted out considerably in the shark market; the supply curve has also shifted out dramatically as many fishermen have joined the market, eager to earn some of the massive profits available. This has led to a very large increase in the number of sharks caught.
Some countries, like Palau, have begun to think long term - knowing that the market can only survive if the sharks are preserved has led to new regulations and enforcement. Unfortunately in this example, Palau, unlike Canada (where regulations are enforced), can only supply a single enforcement ship which can not cover the territory needed and the result will be an inefficiently regulated, uncontrolled open resource.
What's Being Done in Palau
In an effort to reduce fishing of sharks, Palau has made it illegal to fish for them in its waters. This has the potential to be effective, however, with only one boat to patrol the entire sanctuary the incentive to stop fishing will be low for many. The article does not say how Palau will punish those caught fishing inside it's waters, but fines and potentially prosecution could be in order. Even though Palau is attempting to increase the marginal cost of fishing by punishing those it catches, there will be many who feel the risk is low enough to continue to fish sharks inside Palau's waters. To really solve this problem, we need drop the demand curve by changing people’s minds to stop eating shark fin and to realize that while many people don’t see the harm in taking Jaws out of the sea, sharks are an essential part of the marine food chain, and their low numbers threatens to destabilize the whole food chain. As with many fisheries around the world the shark fishery around Palau is in danger of collapse (as many of the species are endangered) and without a drop in demand (and a subsequent drop in the number of sharks supplied) then the sharks may be fished to extinction.
The problems in Palau are a result of not only their inability to enforce regulations, but the lack of controls the world over. Even if Palau had the abilities to enforce their borders, people would cluster just outside to fish the edges. Due to the ability to free-ride (enjoy the efforts of others to fix overfishing and enforce regulations) it is currently almost impossible to protect sharks in a globe-spanning ocean. No one party has the power currently to make any real dent in the problem.
In Summary
Environmental protection is a condition, and a prerequisite, for long-term economic growth. Economic policies must be broadened to recognize that the nature is the foundation for all life on Earth. If we are to continue to grow, if not persist, then there should be a new concept among people and governments worldwide which increasingly recognizes that, while economics may make the world go round, what makes economics go round is the friendly environment which offer human beings food and resources. To pursue the short-term benefit, overfishing shark may cause serious problem of the whole food chain. Protecting the exclusive economic zone is the measure which protects environment to develop long-term economic growth.
Prof's Comments
I'm not sure how critical shark conservation is to global economic growth, other than being symbolic of how we are not considering the place that organisms such as sharks play in the ecosystem. As discussed in class, the demand curve is shifting out, likely a consequence of increasing wealth in places like China. You do have to be careful about shifting and movements along the demand curve. More people will enter the fishery when the price increases. This is a shift along the supply curve. When technology reduces the cost of harvesting sharks, then the supply curve shifts out.