Working papers

Why Natural Disasters are a Disaster in Common Property Regimes

Developing countries tend to suffer the most from natural disasters, but the mechanisms underlying this outcome are poorly understood. I postulate that the lack of strong and well defined property rights for renewable resources is a key factor increasing the impacts of disasters. Using a theoretical model for renewable resource extraction with irreversible investment, I show that common property regimes incentivize agents to invest in ways that exacerbate both immediate losses from disasters and increase the cost of recovery after they hit. I test these predictions by examining investment patterns across institutional regimes in Chilean small scale fisheries before and after a tsunami in 2010. The results indicate causal links between more common regimes and excessive investment increasing the cost of the tsunami. This paper contributes to the ongoing work on the economic impact of natural disasters and provides an argument for how institutional regimes can be used as mitigation strategies. Link

Transboundary Marine Protected Areas [Under review]

(with Costello, C.)

Countries exploiting transboundary fisheries face strong incentives for over-exploitation. This basic economic insight has been validated empirically; transboundary fisheries tend to be in worse condition than fisheries in single nations. Thus, transboundary fisheries pose a significant, and globally ubiquitous, management challenge. Attempts to solve this challenge through cross-country cooperation have been largely unsuccessful because defection is often more attractive than adhering to cooperative agreements. We explore the economics of an alternative solution, a transboundary marine protected area (TMPA), and derive the conditions under which it can improve profits and stock biomass, even in the presence of individually-rational non-cooperation across countries. We find that well-designed TMPAs have the potential to overcome non-cooperation across countries; this result is strengthened when stocks have relatively low growth rates. A well-designed TMPA can earn higher profits for both countries, increase stocks in both countries, and reproduce the fully cooperative outcome. Link

Sharing is not caring

(with O. Liu)

Political arrangement of the ocean creates perverse incentives that lead to the overexploitation of transboundary resources, when compared to the social optima. In this paper, we hypothesize that transboundary resources in the ocean must be subject to more aggressive extraction and in worse conservation status. We formalize this intuition with a theoretical model of resource extraction and then test these claims empirically by examining global fisheries. We compile a novel dataset that that traces the spatial distribution of the most important fisheries globally, and show that shared fisheries are in worse shape than those contained in single economic exclusive zones, even in the presence of extraction agreements and modern management practices. This paper alleviates the surprisingly lack of evidence regarding these international dynamics, and also raises concern as to how future changes to habitat suitability due to climate change may affect and even jeopardize the status of internationally shared natural resources; particularly fisheries. Link

The Economic Impact of Modern Piracy on Global Shipping

(with G. McDonald)

Poorly defined and enforced maritime jurisdictions have historically rendered the shipping industry vulnerable to piracy. Currently more than six hundred attacks take place every year, with most of them taking place in the Straits of Malacca, West Africa, the waters off Somalia, and the Indian Ocean. In this paper, we develop the theoretical background and empirically establish and quantify the causal effect of piracy on the shipping industry. We update past theoretical efforts by including strategic behavior across and between shippers and pirates, and compile a unique global geospatial dataset to test those insights. The empirical analysis utilizes high spatial and temporal resolution information on pirate attacks from the US National Geospatial-Intelligence Agency, individual vessel tracks of all known cargo and tanker vessels that use the AIS vessel monitoring system, and individual track weather patterns. Our results show that pirate attacks lead to significant aversion responses by the shipping industry that translate into an industry-wide waste of fuel and labor resources that far exceed the cost of anti-piracy deployments. This paper contributes to the public debate on maritime jurisdiction enforcement and international duties for the protection of trade channels, and their role in global non-renewable resource utilization. [Available upon request]


Palacios-Abrantes, J., Herrera-Correal, J., Rodriguez, S., Brunkow, J., & Molina, R. 2018. Evaluating the bio-economic performance of a callo de hacha (Atrina maura, Atrina tuberculosa & Pinna rugosa) fishery restoration plan of La Paz cove, Mexico. PLOS ONE 13(12): e0209431. Link

Liu, O., Molina, R., Wilson, M., & Halpern, B. 2018. Global opportunities for mariculture development to promote human nutrition. PeerJ 6:e4733; DOI 10.7717/peerj.4733. Link

Molina, R., Cerda, R., González, E., & Hurtado, F. Simulation model of the scallop (Argopecten purpuratus) farming in northern Chile: some applications in the decision making process. Latin American Journal of Aquatic Resources, 40(3): 679-693. Link

Book chapters

Norambuena, R., González, E., Molina, R. & Gomez, A. 2017. Impacts of Climate Change on Marine Fisheries and Aquaculture in Chile (Chapter 10 – Aquaculture). In: Phillips, B. & Pérez, M. (eds) The Impacts of Climate Change on Fisheries and Aquaculture. John Wiley & Sons, Inc., Hoboken, NJ, USA. Link
Coverage: Aqua

González, E., Norambuena, R., Molina, R. & Thomas, F. 2013. Evaluación de potenciales impactos y reducción de la vulnerabilidad de la acuicultura al cambio climático en Chile [Potential Impacts and Reduction of the Aquaculture Vulnerability to Climate Change in Chile]. In: Cambio climático, pesca y acuicultura en América Latina: Potenciales impactos y desafíos para la adaptación. Taller FAO/Centro de investigación Oceanográfica en el Pacifico Sur Oriental (COPAS), Universidad de Concepción, Concepción, Chile. FAO Actas de Pesca y Acuicultura. No. 29. Roma, FAO, 275-335p. Link

Research in progress

The relationship between environmental variability, risk preferences and institutional regimes for the extraction of renewable resources

The provision of a public good through property rights
(with C. Costello and D. Kaffine)

Contingent valuation of the hurricane forecast program at NOAA
(with D. Letson and P. Mozumder)

Environmental variability, technology adoption and transactions in the Chilean water market
(with A. Ayres)

The economic cost of hurricane forecast error
(with B. McNoldy)

The effect of sea level rise on housing values - Implications for spatial gentrification and public mitigation investments
(with D. Kelly)

Next Generation of Coastal Structures: Incorporating Ecology, Engineering, Economics, and Aesthetic for a Changing Ocean
(with S. Andiroglu, J. Lamere, B. Lynn, D. Kelly, S. Prannoy, J. Sobczak, and K. Sullivan). Website