Inefficient Water Pricing and Incentives for Conservation

Ujjayant Chakravorty (Tufts University)
Kyle Emerick (Tufts University)
Manzoor H. Dar (IRRI)

Abstract : We use two randomized controlled trials in Bangladesh to study a simple water conservation technology for rice production called “Alternate Wetting and Drying (AWD).” Despite proven results in agronomic trials, our first experiment shows that AWD only saves water and increases profits in villages where farmers pay a marginal price for water, but not when they pay fixed seasonal charges. The second RCT randomly distributed debit cards that can be used to pay volumetric prices for irrigation water. This low-cost, scalable intervention causes farmers to place more value on the water-saving technology. Demand for the technology becomes less price-sensitive.

Property Rights and Path Dependence: 19th Century Land Policy and Modern Economic Outcomes

Bryan Leonard (Arizona State University)
Douglas Allen (Simon Fraser University)

Abstract : This paper combines recently digitized individual land patent data with remotely sensed satellite data to test whether long-run economic outcomes dier on lands originally settled under the Homestead Act of 1862 compared to land sold for cash. We nd evidence of significantly lower economic activity on homesteaded parcels that is reflected in county-level differences in income per across counties with varying degrees of homesteading. The results challenge two fundamental ideas in economics: that sunk costs are immaterial and that the initial distribution of property rights does not affect efficiency if transaction costs are sufficiently low. Whereas previous work has emphasized the relatively low transaction costs of land transactions within the Public Land Survey System, homesteading has had a lasting effect on both parcel sizes and incomes.

Property Rights and Domestication

Dean Lueck (Indiana University)
Gustavo Torrens (Indiana University)

Abstract : Abstract This paper combines the property rights approach of Barzel with notions from renewable resources and evolutionary economics to examine the domestication of wild animals. Wild animals are governed by weak property rights to stocks and individuals while domesticated animals are governed by private ownership of stocks and individuals. The complex evolutionary process of domestication can be viewed as a conversion of wild populations into private property as well as a transition from natural selection to economic selection controlled by owners of populations and individuals. In our framework domestication is not the explicit goal of any economic agent, but it rather emerges as the long run outcome of an innovation in hunting strategies in a hunter-gatherer society. Our formal model also suggests that the domestication process moves slowly at first but then proceeds rapidly, aligned with the archeological evidence on domestication events. Keywords: Domestication, property rights, renewable resources, evolutionary economics. JEL Classification codes: O130, Q1, Q2

Common Pool Resources, Spillover Effects, and Local Security: a Theoretical Foundation with Preliminary Evidence

Jessica Steinberg (Indiana University)

Abstract : To what extent does common property management of common pool resources (CPRs) yield spillover effects in other spheres of behavior, influencing individual behavior beyond the realm of natural resource management? Existing research suggests that communities that participate in community management schemes of CPRs can successfully manage a resource for the long term (Ostrom 1990, Agrawal and Chhatre 2006) and reduce conflict over the use of a CPR through the specification of clear rules for its management, and monitoring and enforcement of these rules (Ostrom 1990). However, little research has been done to evaluate the potential of positive externalities of these forms of local cooperation - existing literature says nothing about reducing conflict in other domains or adjacent systems. In this paper I explore the potential for spillover effects of common property rights regimes at the community level. Using a “games theory” framework (Bednar and Page 2007), I develop a theory and provide preliminary evidence to adjudicate between four competing hypotheses. I rely on preliminary evidence from a survey in Casamance, a separatist region in southern Senegal, where the creation of common property management of forests has been implemented as an explicit peacebuilding strategy.