35 Pages Posted: 12 Jun 2008
This Article applies an information-cost theory of property to water law. Because of its fluidity, exclusion is difficult in the case of water and gives way to rule of proper use, i.e., governance regimes. Looking at water through this lens reveals that prior appropriation employs more governance and riparianism rests more on a foundation of exclusion than is commonly thought. The development of increasing amounts of exclusion and governance are both compatible with a broadly Demsetzian account that is sensitive to the nature of the resource. Moreover, hybrids between prior appropriation and riparianism are not anomalous. Exclusion strategies based on boundaries and quantification allow for rights to be formal and modular, but this approach is particularly challenging in the case of water and other fugitive resources. The challenges of exclusion that water and other fugitive resources present often lead to a semicommons in which elements of private and common property both coexist and interact.
Keywords: water law, riparianism, prior appropriation, modularity, semicommons, exclusion, governance, fugitive resources
JEL Classification: D80, K11, Q25
Suggested Citation: Suggested Citation
Smith, Henry E., Governing Water: The Semicommons of Fluid Property Rights. Arizona Law Review, Vol. 50, No. 2, 2008; Yale Law & Economics Research Paper No. 369. Available at SSRN: https://ssrn.com/abstract=1142994