Prospects for Small-Scale Aquaculture in Chile: User Rights and Locations

Abstract

Chile’s extended allocation of marine user rights aims to reduce overextraction of marine resources. New user rights promote small-scale aquaculture both to increase coastal incomes and to encourage fishers to transition to other livelihoods. Some activities prove profitable only in particular biogeographic settings, such as open ocean or estuaries. We examine a coastal region of Chile to investigate the response of households to these marine-based activities and rights. Because residents report a low propensity to move, we analyze the drivers of household activity choices conditioned on their biogeographic zone and user rights. In a second step, we find that variability in income across households is explained by household characteristics, the chosen economic activities, and geographical location. In policy experiments based on these regression results, we find that the adjustment to new policies presents challenges for inducing fishers to undertake small-scale aquaculture, without imposing short-run income losses.