FAD vs. free school

This paper assesses the effect of Marine Stewardship Council certification on the allocation of fishing effort by Filipino purse seine fishers operating in the waters of the Parties to the Nauru Agreement. Targeting skipjack tuna, these purse seiners allocate effort under a vessel day scheme to either MSC certified free school fishing or non-MSC certified fishing on fish aggregating devices (FADs). Based on historical catch and price data, the optimal set of fishing activities are determined in terms of the mean and variance of fishers' gross margin at given levels of risk aversion. The results show that MSC certification stimulates fishers to reduce their allocation of effort on non-MSC compliant FADs, and consequently convert this effort to MSC compliant free school purse seining. In general, the MSC also increases the yearly gross margin of fishers as compared to the situation without MSC certification. The MSC therefore appears to be effective to a certain extent in promoting a transition to more sustainable fishing practices. However, the results also indicate that the risk profile of fishers is a key but underexplored dimension of assessing the potential impact of MSC certification on effort allocation.