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Cross-sectoral externalities related to natural resources and ecosystem services

Author

Listed:
  • Manuel Bellanger

    (AMURE - Aménagement des Usages des Ressources et des Espaces marins et littoraux - Centre de droit et d'économie de la mer - IFREMER - Institut Français de Recherche pour l'Exploitation de la Mer - UBO - Université de Brest - IUEM - Institut Universitaire Européen de la Mer - IRD - Institut de Recherche pour le Développement - INSU - CNRS - Institut national des sciences de l'Univers - UBO - Université de Brest - CNRS - Centre National de la Recherche Scientifique - CNRS - Centre National de la Recherche Scientifique)

  • Robert Fonner
  • Daniel Holland
  • Gary Libecap

    (UC Santa Barbara - University of California [Santa Barbara] - UC - University of California)

  • Douglas Lipton
  • Pierre Scemama

    (AMURE - Aménagement des Usages des Ressources et des Espaces marins et littoraux - Centre de droit et d'économie de la mer - IFREMER - Institut Français de Recherche pour l'Exploitation de la Mer - UBO - Université de Brest - IUEM - Institut Universitaire Européen de la Mer - IRD - Institut de Recherche pour le Développement - INSU - CNRS - Institut national des sciences de l'Univers - UBO - Université de Brest - CNRS - Centre National de la Recherche Scientifique - CNRS - Centre National de la Recherche Scientifique)

  • Cameron Speir
  • Olivier Thébaud

    (AMURE - Aménagement des Usages des Ressources et des Espaces marins et littoraux - Centre de droit et d'économie de la mer - IFREMER - Institut Français de Recherche pour l'Exploitation de la Mer - UBO - Université de Brest - IUEM - Institut Universitaire Européen de la Mer - IRD - Institut de Recherche pour le Développement - INSU - CNRS - Institut national des sciences de l'Univers - UBO - Université de Brest - CNRS - Centre National de la Recherche Scientifique - CNRS - Centre National de la Recherche Scientifique)

Abstract

Standard approaches to environmental and natural resource use externalities generally focus on single-sector resources and user groups. Remedies include Pigouvian-style government constraints, small group controls following Elinor Ostrom, or less frequently, bargaining across users as outlined by Ronald Coase. However, many difficult natural resource management problems involve competing uses of the same resource or multiple interdependent resources, across multiple, heterogeneous sectors. Cross-sectoral externalities are generated and impede attainment of conservation objectives. The multiplicity of resources and stakeholders, who may have different property rights, hold different use or non-use values, have different traditions, or fall under different regulatory regimes, increases the likelihood of multi-jurisdictional conflicts. We provide an institutional analysis following Oliver Williamson's four-levels of institutions (social embeddedness, institutional environment, governance, resource allocation) to illustrate the sources of potential conflict, the costs of addressing them, and the potentials for exchange. In comparing the costs of alternative approaches, we include transaction costs associated property rights; the costs of lobbying, implementing, and enforcing government regulation; and the costs of scaling up from small-group controls when resource problems involve multiple sectors and heterogeneous populations. In our illustrative case examples, instruments that are not formal property rights are exchanged at lower transaction costs. We close by discussing how Coasean, Pareto-improving voluntary exchange agreements may be lower cost, more effective, and more durable solutions than alternative management regimes to mitigate cross-sectoral externalities.

Suggested Citation

  • Manuel Bellanger & Robert Fonner & Daniel Holland & Gary Libecap & Douglas Lipton & Pierre Scemama & Cameron Speir & Olivier Thébaud, 2021. "Cross-sectoral externalities related to natural resources and ecosystem services," Post-Print hal-04203091, HAL.
  • Handle: RePEc:hal:journl:hal-04203091
    DOI: 10.1016/j.ecolecon.2021.106990
    Note: View the original document on HAL open archive server: https://hal.science/hal-04203091
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    More about this item

    Keywords

    Coasean bargaining; Environmental policy; Institutions; Multi-jurisdictional conflicts; Property rights; Transaction costs;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery

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