Derby versus ITQ: Iceland’s coastal fisheries explained and compared to its ITQ-managed fisheries

Abstract Iceland adopted a derby fishery strategy throughout its coastal fisheries, which opened for all vessels in 2009. For simplicity, this paper refers to these fisheries as coastal fisheries (strandvei ð ar), in which small vessels mostly catch cod (Gadus morhua) during the summer. This article describes the coastal fisheries and compares their results to those of other fisheries in Iceland, all of which are managed by an individual transferable quota (ITQ) system. The profitability and the rate of accidents are examined. According to observations of numerous fisheries around the world, the coastal fisheries are assumed to be much less profitable than other fisheries in Iceland – indeed, nonprofitable – because of the derby nature of the fisheries. The findings of this study validate this assumption: the coastal fisheries have been on average generating losses, while other fisheries in Iceland have been profitable. Moreover, it was hypothesized that the derby management system of the coastal fisheries might lead to the rate of accidents in the coastal fisheries being higher than others in Iceland because of incentives generated by the race to fish, which could result in coastal fishers disregarding safety. The findings did not support this; accidents in which a person was injured were uncommon in the coastal fisheries and were relatively less frequent than in other fisheries. However, reported incidents without personal injuries, which were mostly caused by mechanical failures, occurred comparatively more often in the coastal fisheries than in other Icelandic fisheries.