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Abstract
Overcapacity is a major problem in common-pool resources. Regulators increasingly
turn from limited entry to individual transferable use rights to address overcapacity.
Using individual vessel data from before and after the introduction of
individual harvest rights into a fishery, the paper investigates how characteristics of
rights, scale of operations and transition period affect changes in individual and
fleet capacity utilisation and excess capacity. The results indicate that individual
harvest rights in both theory and practice offer the potential to address the problem
of overcapacity in common-pool resources currently managed with limited-entry
regulations.