Bargaining for American Indian Water Rights

Abstract

"When and why do resource users successfully negotiate to create certainty over property rights, and when does this process fail? We examine this question in the context of American Indian reservations’ implicit water rights under a 1908 Supreme Court ruling (Winters v. United States). To legally quantify Winters rights, a reservation must enter into the costly process of either reaching a negotiated settlement agreement with the US government and neighboring water users, or through judicial decree in state court. To date, only 59 of 225 federally recognized reservations in the west have legally defined these rights. We use both the adjudication itself, as well as the results for the tribe in terms of water and direct federal funding secured, to quantify benefits. We show that the likelihood of entering into the adjudication process is increasing in the expected benefits of settlement. However, a costly bargaining process, as measured by the number of users, increases the duration of the adjudication process. Conditional on settlement, we show that the amount of water entitlement per acre of farmland is decreasing over time."