Environmental Policy as an Institution of Collective Ownership: Water Pollution Control Policy in the United States, 1850-1980

Abstract

"My paper argues that the contemporary research in common property opens up an interesting avenue for economic analysis of environmental policies. It facilitates the conceptualization of environmental policies as institutions for the ownership and management of environmental resources that may have been established, formulated, maintained, and/or changed in part to forward values other than economic efficiency and welfare. Research in common property also offers a structural model of institutions for ownership and resource management that enables a more detailed analysis of these complex institutional arrangements than environmental economics and law and economics have been able to accomplish. Law and economics can in turn offer tools to examine how the formulation of institutions affects their enforceability, consequences, and viability. In what follows, the first section of my paper discusses in greater detail how research in common property can be extended to the analysis of environmental policies.

"The subsequent parts of my paper aim at demonstrating that research in common property can fruitfully inform the analysis of environmental policies by examining water pollution control policies in the United States from the middle of the 19th century until the environmental decade of the 1970s. The second section will examine how riparian law governed the polluting use of watercourses by early industrial establishments in the 19th century. I will discuss how, in part to facilitate economic growth and development, riparian law constituted a use of water as a transferable asset and established market allocation of water quality. The third section will examine how early water pollution control statutes enacted in many states after the turn of the century established collective ownership and political allocation of water resources to protect public health. The fourth section will discuss how federal water pollution control legislation responded to the larger scale and broader range of water pollution problems in the postwar era and protected the quality of water also for recreational purposes and for their own sake. I will also discuss in each section to what degree institutions succeeded in forwarding these objectives.

"My conclusions summarize my observation on the structure, functioning, performance, and evolution of water pollution control policies in the United States. I will also indicate the implications of common property research for the analysis of environmental policies and vice versa."