GLOBAL COMMONS
BLUEFIN TUNA
“what is A market has two sides; the producer’s side and the consumer’s side. Which means, there are those who produce the goods and services and there are those who buys the goods and services.
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a market
“ global Global commons are natural resources that does not belong to a specific individual or nation. Therefore, anyone can take it.
commons
Bluefin Tunas are considered a global common because they tend to migrate a lot. It is hard for nations to claim whether they belong to their ocean borders or not. That way, it’s hard to give restrictions or limits to avoid overfishing them.
bluefin tuna
Bluefin Tuna is well known as the ‘fighter’ of the ocean which made it a popular catch among recreational fishermen. Even though it may be hard to catch, commercial fishermen have the technology required to catch them. Each bluefin tuna costs 100,000
1. Can be found mostly in the northern Atlantic Ocean 2. One of the fastest fish in the sea 3. Can grow to 3 meters and 700kg 4. 6th most threatened species in the world (World Wildlife Fund)
tragedy of the commons This tragedy of the commons happen because fishermen and firms don’t see that their action have a significant cost. The fishermen in one side of the ocean may be fishing for the bluefish tuna and thought that just that amount won’t give a significant impact to the commons. But if there are 50 other fishermen doing the same thing, then that is a tragedy of the commons. People are fishing the tuna for profit and the more they fish out from the ocean, the more impact it has. The tunas then won’t be able to reproduce and that would be the end of the line. At the end, this natural resource won’t be sustainable.
[producer’s side of the market]
LY PP SU
PRICE
LAW OF SUPPLY the price of bluefin tuna the quantity of bluefin tuna supplied
QUANTITY
The law of supply is from the producer’s side of the market. Firms want to supply more quantity at a higher price. This
[consumer’s side of the market]
PRICE
law of demand de nd
ma
the price of bluefin tuna the quantity of bluefin tuna supplied
QUANTITY
The law of demand is the consumer’s side of the market. The law states that if the price increases, the demand in quantity decreases. This is because consumers want to buy more at the lowest price possible. If the price goes up, there won’t be as much demand. The demand curve is the Marginal Private Benefit which means the consumer is gaining benefit from the Bluefin Tuna. It is also the Marginal Social Benefit; which is the benefit of a whole society for gaining the Bluefin Tuna.
PP LY SU
nd
ma de
PRICE
market equilibrium market equilibrium
QUANTITY
The law of supply and demand states that the producer’s side of the market wants more goods and services with the lowest price possible and the consumer’s side of the market wants to supply more goods and services with the highest price possible. With this, the market equilibrium is established. The market equilibrium demonstrates the ‘compromise’ of the sellers and the buyers. Through this, the price and quantity of the bluefin tuna meets to the consumer’s and producer’s wants. As the producers, they also need to think of the Marginal Private Costs which includes the Land, Labour, Capital and Enterprise. They are included into the price of the Bluefin Tuna.
shortage
quantity
Having a shortage means that there isn’t enough Bluefin Tuna being fished.
{
{
price
shortages & surplus
surplus
Having a surplus means that there are too much Bluefin Tuna being fished that at the end go to waste.
Having the price and quantity at an equilibrium price means that there will be no shortage or surplus. This means that just the right amount of Bluefin Tuna is fished out and being produced; nothing less and nothing more. Through this, there would be an optimal allocation of Bluefin Tuna. But is this enough? They are fished at a high rate everyday and they are in the risk of extinction. Right now, more firms are fishing surplus Bluefin Tuna and at they end they go to waste.
{
price
negative externalities
quantity
The white line represents the market equilibrium excluding the external costs and the pink line represents the market equilibrium including the external costs. Since the external costs are included, the supply curve shifts to the left. The forces of supply and demand will eventually work to move the price and quantity towards the intersection of the supply and demand curve. This means that there will be a new market equilibrium. With this, the price will be higher; which means people will think twice before buying the Bluefin Tuna. If the price goes higher, the quantity demanded and supplied will decrease. This means, there are less Bluefin Tuna being fished out the see and packaged. Which means there are less threats of extinction to the Bluefin Tuna.
The negative externalities are the external cost. This is the affect of overfishing the Bluefin Tuna to nondecision making people. For instance, the social cost may effect the ecosystem of the ocean, to the human population because of the loss of biodiversity. Bluefin Tuna is endangered mainly because of these negative externalities. If producers were to add the negative externalities into the price of the Bluefin Tuna, then the quantity demanded and supply will also drop.
solutions There are some solutions to solve this unfortunate case of threats to the Bluefin Tuna. An obvious one would be to not consume them at all. Turning vegetarian would mean that you won’t be eating this. Signing a petition and informing others about the dangers of extinction to this species of fish would also be much help. But telling people what to eat and what not to eat would be difficult because it’s their own choice. Money or price is usually what determines whether we consume something or not. If the price is too high, we will think twice about purchasing and consuming them. This is why adding the external costs into the price of the Bluefin tuna will be a great idea. Shifting the curve would also mean there will be less quantity being demanded and supplied; which is much better for the Bluefin Tuna. The global commons is actually a very pressing problem because nobody owns it and it’s hard to determine which fish belongs to which nation. Of course within a certain boundary, it belongs to a country but it’s really hard to see who owns the fish especially because Bluefin Tuna migrates a lot. This should be the job of the United Nations to protect this heritage and to give fines or restrictions of fishing Bluefin Tuna.