New Game-Theoretical Approach to Marketing Cooperatives in Fisheries

Source abstract

Abstract While most game-theoretical models in fisheries deal with the conflict of exploitation of the same resource, unlike these models, the present paper is dedicated to marketing conflicts, always accounting for the underlying population dynamics. In the context of marketing cooperatives in fisheries, three models are combined: the classical fishing effort model based on logistic population dynamics, a game-theoretical model of the conflict between a marketing cooperative and its members, and a Cournot-type oligopoly market model. The latter, in particular, means that the market price is determined by the total supply on the market. The fishers selling fish outside the marketing cooperative are punished. In the present paper, within this complex model, based on Pareto optimality, a particular cooperative solution, the so-called nearly ideal solution, is introduced and compared with the previously studied, special non-cooperative solution, also called attractive solution . In fact, for the respective repeated games, counting with the underlying fishing effort dynamics, the two solution types are compared. Results show that the cooperative solution yields higher total payoffs if at least one member fishes, one member is unfaithful, and a specific pricing condition holds. Additionally, increasing the punishment parameter stabilizes the cooperative by ensuring members contribute their catch, while higher fishing efforts increase catches without depleting stocks but require stricter penalties to prevent free-market diversion.