The Institutional Survival Path A Case Study on Mechanical Cockle Fishery and Gas Extraction in the Dutch Wadden Sea Kim van Nieuwaal 1 Reading committee prof.dr. J. Sydow (Freie Universität Berlin) prof.dr. P. Kabat (Wageningen University, IIASA Austria) prof.dr. G. Whiteman (Erasmus University Rotterdam) prof.dr. K. Termeer (Wageningen University) prof.dr. P. Groenewegen (VU University Amsterdam) prof.dr. F. Fleurke (VU University Amsterdam) dr. H. Sminia (University of Sheffield) ISBN- 978-94-6191-048-6 © Kim van Nieuwaal, 2011. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, by print, or otherwise, without prior permission from the rightful owner: Kim van Nieuwaal, www.institutionalsurvivalpath.com Cover Design: Ipskamp Drukkers, Matthijs Ariëns & Robbert de Vries Photography ‘Sunset at the Wadden Sea’: Bas Meelker, www.basmeelker.nl Printed by: Ipskamp Drukkers 2 promotor: prof.dr. F. Fleurke copromotor: dr. H. Sminia 4 promotor: prof.dr. F. Fleurke copromotor: dr. H. Sminia Disclaimer Mechanical cockle fishery and gas extraction in the Dutch Wadden Sea have been highly controversial issues for many years, taking into account their ecological, cultural, political, social and economical aspects. This research has never had the intention to take a position in these debates. The cases have been selected, based on criteria which are dealt with in the book, to test the proposed theoretical model. Despite the efforts to take into account as many of the various perspectives involved when carrying out the research, the eventual result as it is presented here will by definition be vulnerable to the criticism of practitioners holding specific views and having had particular experiences. Therefore, the author is fully responsible for the text, the interpretations, the analyses and possible mistakes. However, comments are much appreciated. Please visit: www.institutionalsurvivalpath.com 5 6 CONTENTS CONTENTS Prologue 1Prologue Chapter 1 Intervention in government sensitive markets 3Chapter 1 Intervention in government sensitive markets Chapter 2 The model of the institutional survival path 21Chapter 2 The model of the institutional survival path Intervention act 24 Intervention act Institutional bandwidths 28 Institutional bandwidths The strategy path of the firm 41 The strategy path of the firm Controversies 53 Controversies Mobilization 66 Mobilization Proposing the institutional survival path 71 Proposing the institutional survival path Chapter 3 Concerning process research method 77Chapter 3 Concerning process research method Epistemological positioning 81 Epistemological positioning Indicators of the ISP components 89 Indicators of the ISP components Research design 95 Research design Intermezzo 119Intermezzo Chapter 4 Turning tides: introducing the Wadden Sea 121Chapter 4 Turning tides: introducing the Wadden Sea The regulatory framework 122 The regulatory framework The network of agents 133 The network of agents The first glimpses of institutional bandwidths 154 The first glimpses of institutional bandwidths Chapter 5 Mechanical cockle fishery in the Dutch Wadden Sea 157Chapter 5 Mechanical cockle fishery in the Dutch Wadden Sea Demarcation of the object of study 158 Demarcation of the object of study Four cockle controversies 163 Four cockle controversies Conclusion 204 Conclusion Chapter 6 Gas extraction in the Dutch Wadden Sea 207Chapter 6 Gas extraction in the Dutch Wadden Sea Demarcation of the object of study 209 Demarcation of the object of study Three Wadden gas controversies 216 Three Wadden gas controversies Conclusion 235 Conclusion Chapter 7 Summary and conclusions 239Chapter 7 Summary and conclusions Epilogue 259Epilogue References 261References Annex 1 Acronyms 281Annex 1 Acronyms Annex 2 List of interviewed agents 283Annex 2 List of interviewed agents Annex 3 List of used websites 285Annex 3 List of used websites Annex 4 Print screen example of cockle data base 287Annex 4 Print screen example of cockle data base Annex 5 Print screen example of gas data base 288Anne Annex 6 Map of nature 2000 areas including the Wadden Sea 289x 5 Print screen example of gas data base Summary in Dutch 291Summary in Dutch Acknowledgements 295knowledgements 7 8 Prologue_ Fisherman Bakker had come to the cold and misty harbor of Den Oever that Autumn morning in 2005 to inspect his cockle ship. The WR 82 was still one of the biggest and most sophisticated ships of the fleet. Bakker was almost 65 now and had already started to leave Gerdia Ltd to his two sons. The three of them had appeared on national TV about a year earlier. They were being interviewed for a documentary called „The Wadden Sea conspiracy‟. The mechanical cockle fishery had been sacrificed by the politicians for the big money involved in gas extraction in the Wadden Sea, it was stated by the film makers. The sector was about to be expelled from the wetlands, whereas mining company NAM was given prospects for future gas extraction at that very same nature reserve. The Bakkers were still convinced of the fact that they had earned their rightful place in the Wadden Sea. They did no harm to it, they lived with it. Took care of it. In front of the camera, they stood there as sturdy fishermen in the cabin of the their ship, the WR 82, the flagship of the cockle fleet in the Wadden Sea. Deep within their hearts they knew that it was over. The year 2004 had started positively with the high hopes of the EVA II report, which - they believed - proved the possibility of a sustainable mechanical cockle fishery. However, later that year the Meijer report was published, opening up possibilities for gas extraction, and, in addition, the European Court decided that permits for mechanical cockle fishery on the Wadden Sea should not be automatically renewed each year. The Government then decided to expel the fishermen from the Wadden Sea but to allow gas extraction. The Bakkers were devastated. They had to get themselves together and move on, but not with cockles. Bakker senior made plans to sell his ship. In addition, he would gradually finish off the things he had been doing as the fleet coordinator for his long-time buddy Lenger, who once helped him to set up his own enterprise, and would then retire. His sons bought a shrimp vessel. „Look‟, he said, gazing through his binoculars from the cabin of the WR 82, on that misty morning a year and a half after the Meijer report, „there they go. It looks as if they are on to some shrimps there. They are really getting the hang of it. They will be all right, my sons…¨ 1 2 Chapter 1 Intervention in Government Sensitive Markets Firm versus government Every firm has to deal with government interference. Firms and government are bound to one another in modern capitalist societies. Government1 sets the rules for market agents to carry out their competitive actions. It has the ability to intervene in the market mechanism. So it might thus seem that, as a firm, the government can „make you or break you‟. However, reality shows a much more complex relationship between the two. For instance, the mechanical cockle sector in the Wadden Sea was given the knock-out blow by a Parliamentary decision in 2004, but it was not primarily government that the fishermen held responsible for that. It was the environmentalists, the media and the scientists who were to blame, they still believe. The complexity of the relationship between firm and government is also illustrated by the case of the Wadden gas. Mining company NAM was allowed by Parliament to resume its activities in the Wadden Sea, at the very same time that the mechanical cockle fishermen were expelled from these wetlands. Traditionally, the plans of NAM in the Wadden Sea have always been endorsed by the Ministry of Economic Affairs, yet Parliament has often had its reservations regarding Wadden gas. This scrutiny had even led to a cessation of mining activities five years earlier, in 1999. Apparently, the relationship between firm and government does not adhere to the simplicity of an unambiguous one-to-one contact. These two examples are unique and they will be dealt with in greater detail later, but they both illustrate the idea that government intervention takes place within a context of a complex firm-government interaction 1 In this research, government will be understood as the total of political and bureaucratic bodies making and carrying out national and local public policy. A profound discussion on the definition of government goes beyond the scope of this research. 3 process. That government encompasses both executive bureaucratic organizations as well as political bodies is only a partial explanation. The complexity lies in the coming together of two very distinct worlds, in which government intervention plays a crucial role: the public and the private. Firms and government constitute a state-market dichotomy, each having their own logics underlying their strategies and policies.2 Both worlds, the one serving private interest and the other serving public interest, meet in the case of a market intervention. Or should we say „clash‟? The private side supplies the competitors needed for the actual trading, whereas the public side supplies the institutional rules and enforcement to prevent negative externalities. Government intervention in private industries is when market forces and institutional powers most obviously clash. By drawing up laws and regulation, government has the ability to alter the institutional context to influence the actual behavior of market parties. Intervention will take place when, in the eyes of the policymakers, market mechanisms do not lead to desired outcomes. But what effects does government intervention have on the strategy of the firm? Does a firm‟s strategy, for instance, just conform to new laws and legislation, or is there more at stake in the interaction process between the public and the private sphere? The latter will be argued here.