Fellowships, Presentations, and News
(CC)
Erskine Fellow
University of Canterbury, February-May 2019
Keynote & Plenary Addresses
Plenary Address Series
(Photo by Ellie Van Houtte / CC BY)
“Property Rights and Natural Resources,” Community Lecture, University of Iceland, Reykjavik, October 2023.
“Conservation of Ecosystems through Rights-based Systems,” Keynote, Conference on the Advantages and Disadvantages of Strong User Rights in Fisheries, Copenhagen, October 2023.
“Competition for Migrants on the 19th Century US Frontier: the Rectangular Survey and Upper Midwest compared to Meets and Bounds in the Upper South,” Economic History Association Meetings, Pittsburg, September 2023.
“Property Rights” Presentation in Honor of Harold Demsetz, UCLA Economics, May 2022. The presentation outlines the key insights of Harold Demsetz as they apply to economic property rights. A challenge is raised with rights are not fully commercial and held for non economic reasons. Under those circumstances the beneficial effects of markets as predicted by Demsetz may not fully appear.
Panel Address, Association of State Attorney Generals, “Water Markets and Compensation for Rural Communities,” Maui, 2021. The presentation describes the importance of compensating those parties who may be harmed by water transfers that are broadly beneficial. The estimated gains are so large that compensation is feasible. Examples are drawn.
Panel Address, Former Presidents, Society for Organization, and Institutional Economics, “Transaction Costs, Interest Group Lobbying, and Environmental Policies,” 2021. The argument is that those who have dismissed Coase’s alternative for addressing environmental and natural resource losses from over exploitation to justify Pigouvian type controls by stressing the high transaction cost of assigning property rights have focused on the wrong costs. The appropriate ones are the high costs of general collective action in a Pigouvian framework relative to the lower cost of interest group lobbying. The latter allows special constituencies, including agencies, to advance their objectives in implementing Pigouvian controls that are unlikely to be welfare improving.
“American Exceptualism: Property Rights to Land in the US and Argentina: The Long-term Impact on Individualism, Liberty, Optimism, Political Stability, and Economic Growth,”November 2019, Arizona State University. Presentation explored the impact of broadly based assignment of tradable rights to land in the US versus tightly allocated rights to land that we held as a basis for status. The lack of market trading inhibited introduction of new farm organization, size, and contributed to misaligned incentives between labor and owners. Farms in Argentina, all else equal were larger, relied on short term tenant contracts, and had more land in livestock than in crops despite rising grain relative to livestock international prices. Attributable to the desire of large owners to maintain estates.
“Cost/Benefit Analysis and Impact on Maori and other Constitutent Groups of Marine Protected Areas, May 2019, Law and Economics Society, Wellington New Zealand. Presentation examined the economic and social impact of imposed marine protected areas without full consideration or involvement and compensation of local using groups and uncertainty in ecosystem responses or the distribution of costs and benefits of imposed controls.
“The Role of Property Rights to Land in Explaining Different Economic Performance and Political Stabiilty of North and South America,” January 2019. University of Richmond.
“The Promise of Environmental Markets,” September 2017, College of Charleston.
“The Failure of Cap and Trade in GHG Emissions Control,” College of Charleston, September 2017.
(Photo byTony Webster/ CC BY)
"Allocation of Fishery ITQs: Global Perspective"September 13, 2017. The Nature Conservancy, Lima, Peru
Presentation: Implementation of individual Fishing Quotas (ITQs)
Romano Lecture: "Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: April 7, 2017
Location: Binghamton University SUNY, New York
Link: https://www.binghamton.edu/webapps/calendar/event/details?id=gg-ef6nmvipk9h7bhb73kd2rqi18k
Abstract: We analyze the economic determinants and effects of prior appropriation water rights that were voluntarily implemented across an immense area of the U.S. West, abruptly replacing common-law riparian water rights. The analysis reveals institutional innovation that informs both our understanding of the development of property rights, prior appropriation and contemporary water policy.
Paper: http://ses.wsu.edu/wp-content/uploads/2017/01/Leonard-and-Libecap-1-31-17.pdf
Flyer
"Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: April 11, 2017
Location: Carnegie Mellon University, Pennsylvania
"Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: April 26, 2017
Location: University of California, Riverside
"Coasean Bargaining to Mitigate Overfishing: The Case of Big Eye Tuna"
Date: May 14-17, 2017
Location: Coase Institute, Xiamen University, Xiamen, China
Presentation: A Coasean Bargain for Big Eye Tuna
Past
Workshop on Fishery quota allocation: Grandfathering vs. Auction
Date: March 14, 2017
Location: Lima, Peru
NSF Panel on Coupled Human and Natural Systems
Date: February 22-24, 2017
Location: Washington DC.
Water UCI Colloquium Series: "Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: December 6, 2016
Location: University of California, Irvine
Link: http://water.uci.edu/event/water-uci-colloquium-series-feat-gary-libecap/
Abstract: Dr. Gary Libecap analyzes the economic determinants and effects of prior appropriation water rights that were voluntarily implemented across a vast area of the US West, abruptly replacing common-law riparian water rights. We build upon Ostrom and Gardner (1993) and model irrigation as a coordination problem to show how the features of prior appropriation were necessary to support welfare-increasing contracts for securing and sharing water and financing irrigation infrastructure among numerous, heterogeneous agents. We construct novel dataset of 7,800 rights in Colorado, established between 1852 and 2013 including location, date, size, infrastructure investment, irrigated acreage, crops, topography, stream flow, soil quality, and precipitation to test the predictions of the model. Prior appropriation doubled infrastructure investment and raised the value of agricultural output beyond baseline riparian rights. The analysis reveals institutional innovation that informs both our understanding of the development of property rights, prior appropriation, and contemporary water policy.
Research Group on Political Institutions and Economic Policy
"Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: December 6, 2016
Location: Harvard University
Hoover Institution Fall Retreat
"Threats to American Exceptionalism, Excessive Environmental Regulation"
Date: November 10, 2016
Location: Stanford University
Workshop on Fishery Quota Allocation, Grandfathering vs Auction
Date: September 2, 2016
Location: Torshavn, Faroe Islands
Workshop on Fishery Quota Allocation, Grandfathering vs Auction
Date: August 30, 2016
Location: Reyjkavik, Iceland
"Collective Action by Contract: Prior Appropriation and the Development of Irrigation in the Western United States"
Date: June 15, 2016
Location: Society for Institutional and Organizational Economics Meetings, Paris
CalTech Conference on Rationalizing the Allocation of California Water
"How did we get the Water System we have and what are the Implications for Contemporary Water Policy?"
Date: April 20, 2016 at 4PM
Location: Sharp Lecture Hall - Arms Building, California Institute of Technology, Pasadena, CA 91125
Link: http://workshop.caltech.edu/caH2O/lecture.html
Abstract: Depending on how measured, agriculture may consume 60% of California’s water. With drought reducing supplies and growing urban, environmental and recreational demands, pressures exist to reallocate water. This can come from market exchange based on existing property rights or from regulatory mandates. The former is likely to meet long-term reallocation objectives at lower cost than the latter. The contentious, 20-year battle to shift water from Los Angles to the Mono Basin illustrates the costs of reallocation via regulatory mandates. If water markets are to be used for reallocation today that exchange will be based on prior appropriation water rights. These rights have been criticized as historical anachronisms and inflexible, but in fact they do facilitate exchange. It is useful to understand how California, and indeed, the western US (and Canada) came to adopt prior appropriation rights. The prior appropriation doctrine (first in time, first in right) replaced common-law riparian water rights in an immense area of 1,808,584 mi2 on the western frontier within 40 years, a rare and dramatic voluntary shift in rights regimes that suggests large economic benefits. The analysis, based on Leonard and Libecap (2016), focuses on Colorado, one of the first states to implement prior appropriation and with complete water rights data from 1852 to 2013. We develop a model to demonstrate that when information about resources is costly, prior appropriation facilitates socially-valuable search, coordination, and investment by reducing uncertainty about resource conditions and the threat of new entry. We derive testable hypotheses and test our hypotheses using a novel dataset that includes the location, date, and size of water claims along with measures of infrastructure investment, irrigated acreage, crops, topography, stream flow, soil quality, precipitation, and drought. We find that prior appropriation lowered search costs for subsequent claimants. Moreover, secure property rights to water and controls on new entry doubled average infrastructure investment and raised total irrigated acreage and value of agricultural output by approximately 134% across western states, relative to a hypothetical riparian baseline. The economic returns to prior appropriation were lower in Hispanic areas of Colorado where pre-existing informal sharing norms were in place and where formal rights were not required to coordinate investment and resource management. The analysis indicates why prior appropriation rights are dominant today. Given the long-term ownership expectations associated with prior appropriation, water reallocation that is not based on them could lead to significant economic disruption and cost in achieving California’s emerging water allocation objectives.
"COASEAN BARGAINING TO ADDRESS ENVIRONMENTAL EXTERNALITIES"
Date: April, 2016
Location: Wang Yanan Institute for Studies in Economics (WISE) Xiamen University, China
OSTROM MEMORIAL LECTURE AT INDIANA UNIVERSITY BLOOMINGTON
“ENVIRONMENTAL EXTERNALITIES AND COASEAN EXCHANGE”
Date: Wednesday, February 10, 2016 - 4:00–5:00 P.M.
Location: IU Maurer School of Law, Moot Court Room 123
Link: http://ostromworkshop.indiana.edu/events/memorial_lecture.php
Abstract: I follow the development of the literature and policy recommendations on open access problems: taxes, subsidies, regulation. I then turn to implicit criticisms of these approaches by Elinor Ostrom, Oliver Williamson, and especially Ronald Coase. I augment transaction costs by adding those in lobbying politicians and the bureaucracy. Because interest groups, politicians, and agency officials do not bear the full social costs of their actions, there is a second source of externality along with market failure—government failure. Potential distortions have been neglected in the literature. Vincent Ostrom’s work is a basis for understanding bureaucratic behavior. I then examine how the literature and policy have responded to Coase’s arguments, particularly with cap and trade schemes. I argue that neither have fully incorporated transaction costs in property rights definition and market design. This has important implications for market performance. I conclude with recommendations for further research.
FATE OF THE EARTH SYMPOSIUM, MICHIGAN STATE UNIVERSITY, APRIL 2015.
Video: https://www.youtube.com/watch?time_continue=8&v=6A8GL1OGj4k
Abstract: Common pool resources (CPRs) potentially suffer from over exploitation that arise when parties do not bear the full costs of their actions. Fisheries are over harvested, oil pools and aquifers are over depleted, forests are over logged, and there are too many greenhouse gas (GHG) emissions. These CPR problems are addressed successfully and rapidly in some cases, but not in others. In general we often observe delay and incomplete mitigation. The high transaction costs of reaching agreement on collective action explains why this occurs. Mitigation imposes costs and provides benefits, but these costs and benefits are not proportionately distributed among the parties involved. Some bear more costs than benefits and some more benefits than costs and this leads to differential incentives to support collective action. Four factors contribute to varying assessment of the benefits and costs of mitigation: uncertainty, different perceptions of the problem and preferences for taking action, differences in information about the problem and the costs of addressing it, and questions of compliance. Three Nobel Prize Winners in Economics provide guidance regarding how to analyze these issues: Ronald Coase (1991), Elinor Ostrom (2009), and Oliver Williamson (2009). Smaller CPRs often have successful collective action: less uncertainty, similar preferences and perceptions, similar information, and compliance. Larger CPRs have a mixed record: more uncertainty, different preferences, perceptions and information, and limited compliance. The empirical record includes oil fields, aquifers, fisheries. Ironically, a crisis (collapse of the fish stock, plummeting primary oil production, jump in pumping costs and subsidence for groundwater) promotes collective action. A crisis narrows differences on the benefits and costs of taking action and lowers the transaction costs of collective action. This empirical record of the role of crises may be instructive for major global CPRs, where collective action has not been forthcoming: protection of highly-migratory fish stocks and controls of GHG emissions. Differences across countries in assessment of the benefits of mitigation and in willingness to bear costs have limited cross-national action. A crisis may be necessary to narrow international bargaining positions. This analysis suggests that preemptive collective mitigation is unlikely and that successful international efforts may require a crisis, despite its costs.
“GLOBAL ENVIRONMENTAL EXTERNALITIES, PROPERTY RIGHTS, AND PUBLIC POLICY”
Washington DC Conference in Honor of Ronald Coase, March 2015.
"WATER RIGHTS AND WATER MARKETS"
Levine Family Lecture Series at University of California, Davis
News Articles
Contributing Article Sections
PAST ARTICLES
Will Donald Trump Find the EPA Isn't Just for Tree Huggers?
A debate on possible policy changes and implications under a new EPA. New York Times, December 9, 2016.
“Wall Street Eyes Billions in the Colorado,” Ben Ryder Howe, New York Times, Business, January 3, 2021. Listed contributor.
Economist: Property rights an underappreciated response to resource issues
Write up of my recent talk at the Indiana University entitled, "Environmental Externalities and Coasean Exchange”.
THE WEST NEEDS A WATER MARKET TO FIGHT DROUGHT - WSJ COMMENTARY
The West Needs a Water Market to Fight Drought: Outdated laws are wasting the region’s scarcest resource. Water should be tradable so it finds its most urgent uses. By Robert Glennon and Gary Libecap