Fishbanks Debrief: Sustainable
Management of Resources
Vishal Agrawal
McDonough School of Business, Georgetown University
Fishbanks Debrief
Winslow Homer, Fishing Boats, Key West (1903)
Results
Team Assets
Atlantic 3 3799
Atlantic 2 3171
Atlantic 5 3138
Atlantic 1 2954
Atlantic 6 -2538
Atlantic 4 -2600
Atlantic 7 -3015
What happened? What was your strategy?
• Are there fish? How to tell what was happening with them?
• Value of boats – fluctuations!
• Uncertainty – how much fish, how long is the horizon,
• Aggressive fleet size vs. Small fleet
• Profitability vs. Sustainability? – Short-term profitability vs. long-term
profitability
• Limited resources – lot of players using the same resource –
replenishment
• Right to operate/long term access
Results – Atlantic
Results – Atlantic
If we were able to play the game for some
more rounds…..
Definitions
Sustainable limit
- capacity at which resource can be removed in the long run without
depleting it
Overshoot
- going beyond the sustainable limit of the resource
Collapse
- drastic reduction in sustainable limit (after which resource may or
may not recover)
What caused it?
• Short term profitability
• Time pressure – let’s make money before fish disappear
• Competition
• Uncertainty
• Lack of cooperation or coordination
• Lack of long-term perspective
• Absence of regulation/policy
• Lack of information/knowledge – sustainable limit
“The Tragedy of The Commons”
Garrett Hardin. Science 1968; 162:1243-8.
G. Hardin,
1915-2003
Tragedy of the Commons
Each player acts to maximize its own profits regardless of system impact.
Is the invisible hand a solution to resource problems? First known argument against is due to Lloyd
(1833):
- Herdsman grazing cattle on common pasture
- Entire benefit of adding one animal goes to owner
- Disbenefit of overgrazing caused by adding one more animal shared by all
- Each herdsman adds one more, then one more, ….
- Conclusion: Freedom in a commons brings ruin to all.
• Commons as a food basket: natural resources, forests, parks, parking,…
• Commons as a cesspool: Pollution works similarly (sewage, waste, emissions..).
Individual cost to reduce or treat waste is larger than the individual cost of not doing so.
Other examples of overshoot and collapse
Atlantic Swordfish Catch Pacific Bluefin Tuna Catch
5 16
Thousand Metric Tons/year
Thousand Metric Tons/year
4
12
3
8
2
4
1
0
0
1950 1960 1970 1980 1990 2000
1950 1960 1970 1980 1990 2000
Sometimes, intervention is too late: North sea herring
1400
1200
1000
800
600
400
200 North Sea
herring ban
Mark Wise, Common Fisheries Policy of the European Community, New York, Methuen, 1984.
Consider the Cod
• Northern or Atlantic Cod
• Long-lived, slow to mature
• Once immensely abundant
• Early fishers (e.g., Basque) claimed fish so dense you could walk from Spain to the New
World on their backs.
• John Cabot, exploring Newfoundland in 1497, noted fish so thick they practically blocked
his ship.
• Harvest ≈ 250,000 metric tons/yr through 1950s
• Vital in feeding the Old World, in the development of the New World,
…and of Massachusetts:
The Sacred Cod: Massachusetts
State House
Prevailing Mental Model: Unlimited Abundance
“Probably all the great fisheries are inexhaustible;
that is to say that nothing we do seriously affects the
number of fish.”
Thomas Henry Huxley, 1883
New England Fisheries - Hard Times
“I remember catching 5,000 pounds of fish in eight nets. Today,
it might take up to 80 nets. Back then, the average codfish in
the spring would probably be 25 to 40 pounds. Now, it's 5 to 8
pounds.” - Peter Morse
“Go down to the docks and talk to the guys down there,” said
John Nelson, chief of the Marine Fisheries Division of the state
Fish and Game Department. “Most of them have their boats for
sale. If they could sell their boats and do something else, they
would.”
Source: Clare Kittredge, "N.H. Fish Story Is Not a Happy One," Boston Globe. February 4, 1990.
The Reindeer of St. Matthew island
• 29 reindeer imported to St. Matthew island in the Bering Sea in 1944
• Calculation: Island can support ~ 2000
• By 1957 – 1350 deer
• By 1963 – 6000 deer
• By 1966 – 42 deer
Source: Hawken, Ecology of Commerce
Other examples of collapse and overshoot?
• Hunting and animal stocks
• Climate Change
• Pollution – emissions, waste in the ocean
• Acid rain
• Deforestation
• Reclaiming sea
• Groundwater levels
• Population growth
Your suggestions for solutions?
• Quotas – calculate sustainable limit, assign every year, license/permit
• Awareness
• Regulation – oversight, prohibition
• How to enforce regulation? Differences between countries and
purchasing power
• Voluntary or involuntary reductions/limits
• Industry-wide cooperation
• Global watch agencies and supervision
• Science – earlier and effective signals, understand sustainable limit
• Substitutes
• Global coordination
What is the role of technology?
HIGH TECHNOLOGY
CATCH
PER
SHIP-YEAR LOW
TECHNOLOGY
0
0 MAXIMUM
FISH
DENSITY
Impact of Technology
Other Technologies
• Factory Ships
• Sonar, Radar, GPS
• Spotter Aircraft
• Trawls
• Bottom Drags
• Dredging
• Purse Seines
Florida banned gill nets
and saw fish stocks
rebound.
Source: http://www.erin.utoronto.ca/~w3env100y/env/ENV100/hum/cod.htm
Successful Management of the Commons
• Renewable Resources
• State Fish and Game licensing programs
• Some fisheries, e.g., Maine Lobsters
• National and state parks, conservation zones, land trusts
• International Whaling Commission (effectiveness limited)
• Pollutants:
• CFCs and Stratospheric Ozone (Montreal Protocol, as amended)
• Clean Air Act, Clean Water Act; Limits on other pollutants
• US SO2 cap and trade program
• Self-Regulation in commercial groups, guilds
• Mangos in Brazil
1. Renewable resources
can be used no faster than they regenerate.
2. Pollution and wastes
Ecosystem Services
can be emitted no faster than natural systems can absorb them, recycle them, or render
Human Activity
them harmless.
3. Nonrenewable resources
can be used no faster than renewable substitutes can be introduced.
Source: Herman Daly (e.g., H. Daly (1990) Ecological Economics 2, 1).
What to do as a business?
- Invest in understanding the sustainable limit
- Avoid actions that lower the sustainable limit
- Speed up response
- Develop substitutes
Impact of Climate Change
• Big impact for different industries and companies – livability and
workability, physical assets, infrastructure, food systems and natural
capital
One Example -- A Shifting and Shrinking
Cocoa Belt
Shifting rains and temperatures are
shrinking the Western African Cocoa Belt
(70% of the world’s cocoa production)
Areas of high cocoa suitability, are
forecasted to drop by 50%
Current farming practices are leading to a
2% annual deforestation rate and are
projected to rise to 2.5% for crops like
cocoa in Ghana
Cocoa “Farms”
Very difficult to manage, even with throwing
money at it! Why?
• Chocolate companies are far removed from the farmers, and the
supply chain is global and complex.
Climate risk: a highly interconnected issue with
technological, geopolitical, & economic impacts
When analyzing complex risks in interconnected systems,
environmental risk factors have the highest likelihood that
could most negatively impact industries within 10 years
Examples
- Invest in understanding the sustainable limit
- Avoid actions that lower the sustainable limit
- Speed up response
- Develop substitutes
Develop Substitutes – Aquaculture
• By 2030, there is going to be 20% higher demand for fish as a protein
source globally.
• 2/3rds of this is expected to be met through aquaculture.
Issues with Aquaculture
• Waste and excretion
• Antibiotic resistance
• Escape and spread of disease to wild stocks
• Conversion ratio
https://sustainabilitydefined.com/45-sustainable-aquaculture-with-sophie-ryan
Why work together? Competitive advantage?
What do you have to commit to do?
• Improve environmental and social standards – ASC certification with a
target of 100%
• Improve biosecurity (fish welfare and health) – Report transparently
on use of antibiotics, attempt to reduce it, and research/develop non-
antibiotic solutions
• Securing sustainable sources of fish meal ingredients – Innovations to
find other sources (byproducts, canola oil, insects, algae)
• Improving industry transparency – Report annually on several
indicators
