How climate change is re-allocating ocean wealth – and why it matters

Changing oceans

As the climate changes and our oceans get warmer, fish are increasing swimming towards the poles.

This could have severe economic and political consequences.

The migration of fish into and out of countries’ exclusive economic zones (EEZs) could lead to illegal fishing in neighbouring or international waters and contested claims to fishing rights.

It could even lead to war.

A redistribution of resources

The depletion of the world’s resources is often highlighted as cause and consequence of the global climate emergency.

Less attention is paid to the ways in which climate change will redistribute wealth, productivity, and capital. Long-term changes in weather patterns can shift agricultural productivity across time (earlier/later planting and harvesting) and space.

Warmer temperatures can represent a crisis for some agricultural regions and a boon for others.  For example, some experts predict that the heart of sparkling wine production will migrate from France to England with changing climate. The year 2019, in particular, saw French wine outputs cut at the same time English vineyards were bringing in record harvests.

Changes to ocean productivity

Just as agricultural productivity shifts with climate change, so too can ocean productivity.

Ocean acidification, temperature increases, and changing ocean currents impact the composition and abundance of marine life, disturb delicate ecological balance, and change the spatial distribution of commercially valuable fish stocks.

Whereas vineyards cannot uproot and migrate 20 km northwest each season, schools of fish are free to follow the most suitable conditions across the ocean, passing through areas where they may or may not be legally harvested by a particular boat. While countries at extreme northern and southern latitudes are expected to benefit from fish migration to cooler waters, fishing fleets in many countries are predicted to suffer large declines in catch and revenues.

Declining fish populations and increasing demand for seafood mean that the migration of fish stocks will reallocate valuable ocean wealth.

Possible climate change outcomes

Colleagues and I propose two climate change outcomes through which ocean wealth will be reallocated: value asymmetry and value compression.

1. Value asymmetry will arise as fish move from one location to another, changing who can harvest them, when, and how they will be use. The same fish stock might be worth different amounts to vessels from different countries because of trade or landing restrictions, processing capacity, market conditions, or preferences. As a result, a “fin-fall” on one side of an EEZ or another could lead to a sizable positive or negative jump in the value of the fish.
2. Value compression, on the other hand, refers to the concentration of marine resources into ever smaller spatial domains. Changing ocean conditions could compress existing fish stocks, and the vessels pursuing them, into smaller areas. The increased density of competing vessels could pose safety issues (e.g. gear entanglement), per capita loss in value, and more frequent hostile interactions.

Value compression and value asymmetry incentivise illegal fishing and maritime instability, leading to potential conflict.

Characterising these two climate outcomes helps researchers understand different incentives for illegal fishing, fair compensation for associated damages, and how to better design policies and multilateral agreements to ensure the (conflict-free) sustainability of marine resources.

Ongoing research

I am part of a new £1.1 million project funded by the US Department of Defence, that seeks to determine who will win and who will lose in climate-driven redistribution of marine resources.

Over the next three years, we will develop new economic theory for valuing multiple stocks of marine resources being exploited by multiple actors who derive different streams of net benefits from those stocks. We will then bring this theory to a novel dataset on conflict and cooperative events in fisheries compiled by my colleagues. Finally, we aim to bring our valuation and conflict findings to extend our understanding of fisheries conflict.

While we will focus on empirical examples in the Western Pacific, the Arctic, and the South China Sea, our new understanding of how changing management regimes, resource users and climate conditions impact the value of natural assets is broadly applicable. For example, our research can help better understand the sustainability of UK-EU fisheries in a post-Brexit world.

How the research will inform policy

Ultimately, nature does not abide by political or institutional boundaries. Fish swim freely in the ocean, atmospheric pollutants travel with the winds, and the impact of greenhouse gas emissions reach every corner of the planet.

Capturing the impact of different resource users on the sustainability of natural assets as they traverse management boundaries can help design more holistic, global policies to promote a safe, healthy, and prosperous planet for generations to come.

Dr Ethan Addicott’s research on natural capital and ecosystem services is available on his website and his University of Exeter profile HERE.