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Auctions for Initial Sale of Annual Catch Entitlement

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  • Christopher M. Anderson
  • Daniel S. Holland

Abstract

We use a laboratory experiment, calibrated to a representative New Zealand fishery, to assess three sealed-bid, multi-unit demand auction mechanisms under consideration for allocating quota for species being introduced into the Quota Management System. These auctions allocate the K units to the K highest bids, but prices are determined according to discriminative, Kth price, and K + 1st price rules. In our experiment, the auctions are equally efficient, but revenue is highest in the discriminative auction, and lowest in the K + 1st price auction. Results are robust to industry subjects, and subjects are responsive to the across-unit bidding incentives present in multi-unit demand auctions.

Suggested Citation

  • Christopher M. Anderson & Daniel S. Holland, 2006. "Auctions for Initial Sale of Annual Catch Entitlement," Land Economics, University of Wisconsin Press, vol. 82(3), pages 333-352.
    • Handle: RePEc:uwp:landec:v:82:y:2006:i:3:p:333-352
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    3. Lynham, John, 2014. "How have catch shares been allocated?," Marine Policy, Elsevier, vol. 44(C), pages 42-48.
    4. Holzer, Jorge & McConnell, Kenneth, 2023. "Extraction rights allocation with liquidity constraints," Resource and Energy Economics, Elsevier, vol. 71(C).

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    More about this item

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery

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