Within a period of about two decades Peninsular Malaysia's fisheries had moved from a situation of stable equilibrium to one which exhibits all the classic symptoms of overfishing — declining catch trends, declines in marginal landings per unit of fishing effort, decreases in the percentage of the commercial catch accompanied by increases in the percentage of trash fish in total landings, overcapacity in the fishing fleet, resulting in what appears to be a complete dissipation of the economic rent in the case of the trawl fisheries of the West Coast. Indeed, by 1977 it was estimated that it required four times as much time and capital to land each ton offish than was needed in 1968 (Elliston 1980).

Management of the resource consequently has now to be directed towards regulating fishing effort so as to conserve stocks and optimize their utilization, as provided for in the Fisheries Licensing Policy of 1981, rather than to promote their exploitation, as in the previous two decades.

In so far as the modern trawl-based sector is concerned, the Malaysian situation provides empirical support for Gordon's (1954) prediction, based on economic theory, that an open-access uncontrolled fishery will have the following pattern of activity. Initially, as the fishery develops, fishermen exploiting the untapped resources will reap higher profits, which will attract others into the industry. As the rate of exploitation among the fishermen increases, fish stocks are reduced and competition for them intensifies. Catch rates then fall, eventually reducing profits to a level where the economic rent is completly dissipated, that is, where the value of the catch is merely equal to the costs of catching and delivering the fish.

Gordon (1954, p. 134) blames the inefficiency of fisheries production on “the common property nature of the resources of the sea”. In the case of the artisanal fishermen, the resources of the sea are not those stretching from the coastline to the boundaries of the Malaysian EEZ, but a narrow coastal belt to which they are confined by their traditional inherited technology, lack of capital, and their custom of daily return to their fishing villages.