On the Commons and the Common Law

Abstract:     
Extralegal norms governing the use of common property resources break down when old users groups are confronted by new uses and users groups. In adjudicating such conflicts between old and new users, common law judges have rarely opted for the simple Coasean solution of simply awarding the right to one group or the other. Instead, they have attempted to balance on a case-by-case basis the value of the new use against the harm to the old. Here, I develop a positive theory of the effect of these two alternative common law approaches -- general assignment versus situation-specific balancing -- on the choice between bargaining for use rights versus legislative conflict over use. It is argued especially under an injunctive remedy, a general assignment of the right to one user group or the other greatly increases the marginal cost of productive activity for the enjoined group (since under an injunction, continued use may trigger large sanctions for contempt), thus lowering the opportunity cost of lobbying for legislative intervention to undo the common law assignment. Under situation-specific balancing, by contrast, high value users are likely to prevail in any event and so have much less incentive to invest in costly lobbying. When courts make general assignments, the theory predicts, they increase the relative benefits and lower the relative costs of legislative conflict between the parties; when courts make situation-specific decisions, they retain control and create an incentive for private bargaining. This theory is then applied in an informal way to explain the common law's influence on the famous late nineteenth century conflicts between hydraulic mining and farming in California's Sacramento Valley and anthracite coal mining and downstream riparian uses in Pennsylvania.

Accepted Paper Series