Abstract

Marine protected areas (MPAs) are an important tool for conservation but can be victims of their own success-higher fish biomass within MPAs create incentives to poach. This insight underpins the finding that fishing persists in most MPAs worldwide, and it raises questions about MPA monitoring and enforcement. We propose a novel institution to enhance MPA design-a 'Conservation Finance Area (CFA)'-that utilizes leased fishing zones inside of MPAs, fed by spillover, to finance monitoring and enforcement and achieve greater conservation success. Using a bioeconomic model we show that CFAs can fully finance enforcement, deter illegal fishing, and ultimately maximize fish biomass. Moreover, we show that unless a large, exogenous, and perpetual enforcement budget is available, implementing a CFA in a no-take MPA would always result in higher biomass than without. We also explore real-world enabling conditions, providing a plausible funding pathway to improve outcomes for existing and future MPAs.