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Institutional Path Dependence in Climate Adaptation: Coman's "Some Unsettled Problems of Irrigation"

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  • Gary D. Libecap
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    Abstract

    Katharine Coman's "Some Unsettled Problems of Irrigation," published in March 1911 in the first issue of the American Economic Review , addressed issues of water supply, rights, and organization. These same issues have relevance today, in the face of growing concern about the availability of fresh water worldwide. The central point of this article is that appropriative water rights and irrigation districts that emerged in the American West in the late nineteenth and early twentieth centuries in response to aridity to facilitate agricultural water delivery, use, and trade raise the transaction costs today of water markets. These markets are vital for smooth reallocation of water to higher-valued uses elsewhere in the economy and for flexible response to greater hydrological uncertainty. This institutional path dependence illustrates how past arrangements to meet conditions of the time constrain contemporary economic opportunities. They cannot be easily significantly modified or replaced ex post. (JEL N51, Q15, Q25, Q54)

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    Bibliographic Info

    Article provided by American Economic Association in its journal American Economic Review.

    Volume (Year): 101 (2011)
    Issue (Month): 1 (February)
    Pages: 64-80

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    Handle: RePEc:aea:aecrev:v:101:y:2011:i:1:p:64-80

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    1. Gary D. Libecap, 2006. "The Assignment of Property Rights on the Western Frontier: Lessons for Contemporary Environmental and Resource Policy," NBER Working Papers 12598, National Bureau of Economic Research, Inc.
    2. Kanazawa, Mark T, 1998. "Efficiency in Western Water Law: The Development of the California Doctrine, 1850-1911," The Journal of Legal Studies, University of Chicago Press, vol. 27(1), pages 159-85, January.
    3. Lueck, Dean, 1995. "The Rule of First Possession and the Design of the Law," Journal of Law and Economics, University of Chicago Press, vol. 38(2), pages 393-436, October.
    4. Michael D. Rosen & Richard J. Sexton, 1993. "Irrigation Districts and Water Markets: An Application of Cooperative Decision-Making Theory," Land Economics, University of Wisconsin Press, vol. 69(1), pages 39-53.
    5. Burness, H Stuart & Quirk, James P, 1980. "Water Law, Water Transfers, and Economic Efficiency: The Colorado River," Journal of Law and Economics, University of Chicago Press, vol. 23(1), pages 111-34, April.
    6. Gary D. Libecap & James L. Smith, 1999. "The Self-Enforcing Provisions of Oil and Gas Unit Operating Agreements: Theory and Evidence," NBER Working Papers 7142, National Bureau of Economic Research, Inc.
    7. Johnson, Ronald N & Libecap, Gary D, 1982. "Contracting Problems and Regulation: The Case of the Fishery," American Economic Review, American Economic Association, vol. 72(5), pages 1005-22, December.
    8. Burness, H Stuart & Quirk, James P, 1979. "Appropriative Water Rights and the Efficient Allocation of Resources," American Economic Review, American Economic Association, vol. 69(1), pages 25-37, March.
    9. Rose, Carol M, 1990. "Energy and Efficiency in the Realignment of Common-Law Water Rights," The Journal of Legal Studies, University of Chicago Press, vol. 19(2), pages 261-96, June.
    10. Ellen Hanak, 2003. "Who Should Be Allowed to Sell Water in California? Third-Party Issues and the Water Market," PPIC Research Reports, Public Policy Institute of California, number wtrmkt.
    11. Johnson, Ronald N & Gisser, Micha, 1981. "The Definition of a Surface Water Right and Transferability," Journal of Law and Economics, University of Chicago Press, vol. 24(2), pages 273-88, October.
    12. Hutchins, Wells A., 1931. "Irrigation Districts, Their Organization, Operation and Financing," Technical Bulletins 163085, United States Department of Agriculture, Economic Research Service.
    13. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
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    Cited by:
    1. Ambec, Stefan & Dinar, Ariel & McKinney, Daene, 2011. "Fixed Water Sharing Agreements Sustainable to Drought," TSE Working Papers 11-270, Toulouse School of Economics (TSE).
    2. Theesfeld, Insa & MacKinnon, Anne, 2014. "Giving birds a starting date: The curious social solution to a water resource issue in the U.S. West," Ecological Economics, Elsevier, vol. 97(C), pages 110-119.
    3. Oberlack, Christoph & Neumärker, Bernhard, 2013. "A diagnostic approach to the institutional analysis of climate adaptation," The Constitutional Economics Network Working Papers 01-2013, University of Freiburg, Department of Economic Policy and Constitutional Economic Theory.
    4. Heuson, Clemens & Gawel, Erik & Gebhardt, Oliver & Hansjürgens, Bernd & Lehmann, Paul & Meyer, Volker & Schwarze, Reimund, 2012. "Fundamental questions on the economics of climate adaptation: Outlines of a new research programme," UFZ Reports 05/2012, Helmholtz Centre for Environmental Research (UFZ).
    5. Heuson, Clemens & Gawel, Erik & Gebhardt, Oliver & Hansjürgens, Bernd & Lehmann, Paul & Meyer, Volker & Schwarze, Reimund, 2012. "Ökonomische Grundfragen der Klimaanpassung: Umrisse eines neuen Forschungsprogramms," UFZ Reports 02/2012, Helmholtz Centre for Environmental Research (UFZ).
    6. Ambec, Stefan & Dinar, Ariel & McKinney, Daene, 2013. "Water sharing agreements sustainable to reduced flows," Journal of Environmental Economics and Management, Elsevier, vol. 66(3), pages 639-655.
    7. Garrick, Dustin & Whitten, Stuart M. & Coggan, Anthea, 2013. "Understanding the evolution and performance of water markets and allocation policy: A transaction costs analysis framework," Ecological Economics, Elsevier, vol. 88(C), pages 195-205.

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