Suppose fish stocks in a lake are being overfished by fishers. To reduce the overfishing problem the government could:

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Establishing a tradable, property right entitlement to the fish would create an incentive for fishers to conserve the fish stocks because they would have a stake in their preservation. This would limit overfishing and ensure that the fish population remains sustainable in the long run. Paying to transport more fish to the lake or increasing the length of the fishing season, on the other hand, would only worsen the overfishing problem by putting more pressure on the fish stocks.

Suppose Fish Stocks in a Lake Are Being Overfished by Fishers