The Lesser of Two Inefficiencies: An Anticommons Alternative to Perpetual Conservation Easements
28 Pages Posted: 22 Jan 2013 Last revised: 29 Mar 2014
Date Written: December 22, 2012
This paper argues that a spatial anticommons is a relatively more efficient land-preservation mechanism than a perpetual conservation easement.
Conservation easements represent a new kind of right in the bundle of sticks that is property ownership — a perpetual negative restriction on land, enforceable by the holder, that prohibits the land owner from using the land in any way that is contrary to the terms of the easement. The requirement of perpetuity raises efficiency concerns. Even if it is socially optimal to conserve the land at the time the easement is created, changes in technology, climate, and preferences may render conservation suboptimal in the future. Yet future landowners have no ability to reallocate the land to a more efficient use. Conservation easements are nearly impossible to modify or terminate. As a result, conservation easements may impose long-term costs on society as land is tied up in socially suboptimal conservation.
This paper argues that an anticommons may provide a way to both protect conservation interests and allow for the reallocation of land when reallocation is efficient. Creating an anticommons preserve involves fragmenting the land into small parcels and distributing them to individuals. The parcels are too small to develop, and so, any potential developer must acquire many parcels before the land can be converted from conservation. Facing high transaction and strategic costs, the developer will choose to acquire and develop the land only when the land’s value as a development is significantly higher than its value as a preserve. Thus, although the anticommons is not absolutely efficient, it is relatively more efficient than a perpetual conservation easement because it does not include a legal bar to reallocation.
Part I of the paper defines the anticommons and the perpetual conservation easement. Part II explores the problems with perpetual conservation. Part III explains why perpetual conservation easements succumb to these problems and why conservation easements cannot simply be modified to be more efficient. Part IV describes the structure of the anticommons preserve and explains when, and why, the anticommons is preferable to perpetual conservation easements. Finally, Part V considers legal hurdles to creating an anticommons land preserve.
Keywords: anticommons, conservation, conservation easement, efficiency, propery law
JEL Classification: K00, K11, K32, R14, C7, C78
Suggested Citation: Suggested Citation