Owners Escape Unharmed: Activation of Institutional Rules in Rivalries between Heterogeneous Water Users

Abstract

"The provision of different goods and services from the same natural common-pool resource increases scarcity and threatens renewability. The behaviour of resource users is regulated by various institutional rules, mainly property rights and public policies. These rules are activated in order to defend their own use against others. How do heterogeneous water users solve their rivalries? Our theoretical framework suggests that a resolution of rivalries comesout of a process of activation and confrontation of rules between competing users. We postulate that an owner activates property rights and a non-owner public policies that point him out as a final beneficiary. We retain here two ideal-typical user confrontations: property rights against property rights and property rights against public policies. We advocate that success in the resolution of the rivalry is subject to a specific kind of local arrangement in each case. If two owners confront, then the rivalry is solved through a bilateral agreement, and if an owner confronts with a final beneficiary, then the State compensates the owner for his loss. We test these two hypotheses on four empirical cases in Belgium and Switzerland. What emerges from the analysis is that an owner never loses in a resolution of a rivalry, or not much at all."