Law & Economics Profs Don’t Surf

Mike: It’s pretty hairy in there, sir… .It’s Charlie’s point.
Colonel Kilgore: Charlie don’t surf!
  – Apocalypse Now (1979)

From the November issue of the Journal of Law & Economics, on the commons, endogenous property rights, and surf gangs on the most totally jacking point breaks.

Quality and the Commons: The Surf Gangs of California
Daniel T. Kaffine
Colorado School of Mines

Abstract

In open?access settings, high?quality resources are lucrative, yet fencing out potential entrants may be very costly. I examine the endogenous creation of property rights, focusing on the incentives that resource quality provides to close the commons. Analytical examples explore the incentives of locals to increase or decrease the strength of property rights conditional on how locals and nonlocals value the quality of the resource. The empirical analysis looks at a unique resource—surf breaks—and estimates the relationship between the exogenous quality of the resource (waves at the surf break) and local attempts to seize the common surf break. Using cross?sectional data on 86 surf breaks along the southern California coast, this paper finds that a 10 percent increase in quality leads to a 7–17 percent increase in the strength of property rights. [Emphasis mine]

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