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Capitalizing property rights insecurity in natural resource assets

Corbett Grainger and Christopher J. Costello

Journal of Environmental Economics and Management, 2014, vol. 67, issue 2, 224-240

Abstract: Property rights are commonly touted as a solution to common pool resource problems. In practice, however, the security of property rights over natural resources varies substantially; this may affect returns to ownership and asset values. We use an analytical model to examine the effects of insecure property rights to natural resources on the market value of assets. We then use a unique dataset of fisheries from three countries to examine empirically how differences in property rights affect market outcomes. We find significant asset market capitalization of insecurity arising from (1) ownership disputes, (2) illegal extraction from resource stocks, and (3) the possibility of government revocation of rights.

Keywords: Fisheries; Natural resources; Property rights; Institutions; Individual transferable quota; Capitalization (search for similar items in EconPapers)
Date: 2014
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DOI: 10.1016/j.jeem.2013.12.005

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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

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