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UBC Theses and Dissertations

Discount rates, small-scale fisheries, and sustainability Teh, Louise S. L.


In the face of overexploited and declining fisheries worldwide, a question that is central to the future sustainability of fisheries resources is how willing are fishers to sacrifice their current fishery benefits in order to be able to enjoy higher benefits in the future? Fishers’ rate of time preference, or discount rate, indicates how willing they are to delay current consumption, and is the primary topic of investigation in this thesis. I aim to answer three research questions, focusing on small-scale reef fisheries in developing countries: 1) what is the discount rate of fishers?; 2) what socio-economic conditions predict low discounting behaviour among fishers?; and 3) are discount rates reflective of the exploitation status of fisheries? I use an experimental economics approach to elicit fishers’ discount rates in Sabah (Malaysia) and Fiji, and then use regression analysis to identify the predictors of low discount rates. Further, I integrate economic and ecological concepts to infer fishers’ private discount rates, as well as to explore whether discount rates are representative of fisheries exploitation status. My main findings are that, first, small-scale reef fishers have high discount rates, with a plausible average annual range of 100 to 300%. This appears to apply to fishers in both open access (Sabah), as well as traditionally managed (Fiji) reef fisheries. There is a surprisingly larger proportion of fishers with low discount rates in the open access, compared to the traditionally managed fishery. Second, site and fishery level variables predict low discount rates among fishers, but the effect is different depending on the local socio-economic context. Overall however, it is not clear what specific site level dynamics contribute to the lower observed discount rates in Sabah. Lastly, I find that official discount rates that are used for policy making appear to be too low to fully reflect the short term outlook of reef fishers. Fishers’ higher private discount rates may be more likely to capture the exploitations status, and may be more appropriate to use for evaluating policies that affect fishers’ current and future fishing activities.

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