Where the Rights Lead

Jennifer Meredith investigates the impacts of Alaskan fishing permits

By Kardelen Koldas ’15
October 23, 2020

During a good fishing season, millions of Alaskan wild sockeye salmon swim down meandering rivers into the clear waters of Bristol Bay. A fleet of fishing boats, owned by holders of highly sought-after fishing permits, awaits their arrival.

But after a bad season, some fishermen, including native Alaskans, find themselves facing a tough decision: Should they sell their permit for additional income, pass it down in their family, or hold onto it?

That decision, which can have implications for generations to come, is what Assistant Professor of Economics Jennifer Meredith investigates. “For many people, their attachment to the salmon fishery is their attachment to their culture, to their traditional way of life,” said Meredith, who previously lived in Alaska and studies fisheries economics.

But how is that traditional way of life affected by the Alaskan permit system?

As a graduate student in 2016, Meredith surveyed about a thousand households in nine villages around Bristol Bay, home to the largest wild run of sockeye (red) salmon in the world. She asked them deeply personal questions about their families, fishing permits, and livelihoods. Ever since, she’s used that data to unearth various effects of these permits—especially those that can be transferred—on rural Alaskans and the Alaskan salmon fishery.

Meredith’s studies add to the tiny pool of research that quantifies the long-term consequences of making property rights, like fishing permits, transferable. And her findings provide insight to native communities and local organizations that are working to reverse the current downward trend of fewer native Alaskans holding permits.

Assistant Professor of Economics Jennifer Meredith studies fisheries economics from rural Alaska to West Africa.

“Anything that my work can say about what policies work best to keep the fishing permits in the hands of local harvesters is really helpful for them,” said Meredith, who was drawn to Bristol Bay and fisheries economies because of her interest in game theory, interdisciplinarity, and issues bearing uncertainty and volatility.

The first uncertainty Meredith explored for Bristol Bay fishermen was the long-term impact of the permit system on native populations.

The State of Alaska introduced a permit system in the 1970s because of the increased demand for salmon harvesting. Once beyond an outsider’s reach, these remote fisheries became more accessible with the development of fishing technology. When the danger of depletion emerged, the state limited the number of fishing permits for commercial harvesting.

Nowadays, to fish in places like Bristol Bay, fishermen meeting certain criteria—often favoring native Alaskans—can obtain one of two types of permits: drift net (to fish in open waters) or set net (to anchor a net along the seafloor).

Some of these permits are transferable and can be given to a family member or sold to others. Oftentimes, gifting a permit forces fishermen with multiple children to pick only one recipient—a choice many parents wish they didn’t have to make. And selling it often comes with a heavy price. On average, a second-hand drift net permit sells for $130,000, whereas a set net permit goes for about $35,000. And since a permit might be the one and only large asset these fishermen own, Meredith said, once it’s sold, “descendants might not be able to enter the fishery ever again.”

Her research confirmed the lasting negative impact selling a permit has on families by showing that the sellers’ descendants were much less likely to be involved in fishing and more likely to leave the village.

Descendants’ future prospects also depended on the permit type that their family held.

Drift net permit sellers—mostly men with more financial assets—spent money from the sale on more immediate needs, like moving out of the village or buying more trucks and snow machines, to the detriment of their children’s future, Meredith concluded. But set-net permit sellers—mostly women with fewer assets—invested some of their money toward the next generations’ occupational goals, such as training to become a village health aide or a teacher, creating positive change for their future.

But what brings Alaskans, who rely on these fisheries for their livelihood and hope to ensure its continuation for future generations, to the agonizing point of selling their permits?

Changing circumstances, or shocks, as Meredith calls them.

A chart made by Meredith and Colby students showing permit sales and prices in Bristol Bay since this system was introduced by the state of Alaska in the Seventies.

For drift net fishermen, unexpected changes to catches or salmon prices surfaced as the main reasons for selling their permits. “This fishery is the textbook example of the race to the fish,” she said. In the Alaskan system, where who can fish is limited but how much each person can catch is not, every permit holder tries to harvest as much salmon as possible before hitting the overall quota set by biologists.

In such a race, fishermen invest in the latest technology to beat out the competition but also risk getting saddled with debt after a bad season. When that happens, fishermen see a single way out: cashing in their permit. But Meredith noticed these transactions happened when prices—fluctuating between $60,000 and $250,000—were on the low end. This contradicts what economists often predict: that it’s low productivity that forces people to sell their rights and leave the fishery.

In Bristol Bay, however, bad luck and those unexpected shocks forced permit holders to sell.

Set-net harvesters, on the other hand, mostly sold their permits after a personal life change such as having a child or getting divorced.

Last summer, Meredith collaborated with Colby students to make her findings accessible to the public, especially to the survey-takers toward whom Meredith feels a sense of obligation and gratitude. They’ve created a website explaining Meredith’s results that will soon go live.

“Coming in as a cis, white researcher, I have to be really sensitive to not getting lost in the economic output, but finding a way to get the communities the information that’s going to be most useful to them,” said Meredith, who’s also exploring gender dynamics in the fisheries. “This is my research, but these are their lives.”