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Bureaucratic Opposition to the Assignment of Property Rights: Overgrazing on the Western Range

Published online by Cambridge University Press:  03 March 2009

Gary D. Libecap
Gary D. Libecap
Affiliation:
Assistant Professor of Economics, Texas A&M University, College Station, TX 77843
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Abstract

This paper analyzes the roles of the Departments of Agriculture and the Interior in restricting the assignment of property rights to rangeland in the American West. While common property conditions encouraged overgrazing and dissipation of the rental value of the land, it was in the interest of both departments to oppose the private claims of the ranchers. Moreover, jurisdictional competition for administration of federal land holdings likely delayed the installation of bureaucratic controls on entry and range use until 1934.

Type
Papers Presented at the Fortieth Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 41 , Issue 1 , March 1981 , pp. 151 - 158
Copyright
Copyright © The Economic History Association 1981

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References

1 For a discussion of rent dissipation under common property conditions, see Cheung, Steven N. S., “The Structure of a Contract and the Theory of a Non-Exclusive Resource,” Journal of Law and Economics, 13 (04 1970), 49–70.Google Scholar

2 Economies of scale are discussed in the U.S. Department of Agriculture, Western Range, pp. 208, 417.Google Scholar

3 Annual Report, Commissioner of the General Land Office, 1934.Google Scholar

4 See Gates, Paul W., History of Public Land Law Development (Washington: Public Land Law Review Commission, 1968);Google ScholarPeffer, Louise, The Closing of the Public Domain (Stanford, 1951).Google Scholar

5 Niskanen, William A., Bureaucracy and Representative Government (Chicago, 1971);Google ScholarBorcherding, Thomas, ed., Budgets and Bureaucrats (Durham, NC, 1977).Google Scholar

6 The use of fees to supplement income is discussed in ·Annual Report, Commissioner of the General Land Office, 1913.Google Scholar

7 A related problem is discussed in Johnson, Ronald N. and Libecap, Gary D., “Agency Costs and the Assignment of Property Rights: The Case of Southwestern Indian Reservations,” Southern Economic Journal, 47 (10 1980), 332–47.CrossRefGoogle Scholar

8 For instance see U.S. Department of Agriculture, “The Range Problem in New Mexico,” Bulletin, no. 66, 1908.Google ScholarPubMed

9 The study is found in Parr, V.V., Collier, G.W., and Klemmendson, G.S., “Ranch Organization and Methods of Livestock Production in the Southwest,” U.S. Department of Agriculture Technical Bulletin, no. 68, 06 1928, pp. 18–40. Based on 1943 figures, 34% of the cattle raised in New Mexico and 13% of the cattle raised in Arizona were from public lands. Those percentages were used to determine the cattle stock on public and private lands in 1925 when the Parr, et al., study was conducted. They found that calving rates were 50% on private land and 34% on public land, and herd death rates were 7% and 15% respectively. Those figures were used to calculate the hypothetical herd size with secure tenure. The two herds were valued at $40.00 per head and $28.00, Parr's estimates of the value of cattle on private and public land. The hypothetical herd value was then compared with the actual where cattle were priced according to tenure conditions.Google Scholar

10 Annual Report, Commissioner of the General Land Office, 1886–1908.Google Scholar

11 See Gates, Public Land Law, pp. 470–76.Google Scholar

12 Ibid., pp. 517–18.

13 Annual Report of the Secretary of the Interior, 1902, p. 12.Google Scholar

14 One regression gave t-statistics for claims 2.96, acres.59, constant 7.08, R2 = 71. The results, however, were sensitive to the specification of the equation. Adding the federal budget made claims negative and insignificant and acreage positive and insignificant. Adjusting for legal changes, which allowed for more acres per claim, switched the variable signs. Econometric theory argues that if the sign and significance of a variable change due to the addition of other reasonable variables, the equation is misspecified. That indicated that more work is necessary to isolate the structural changes which occurred after 1875 and affected the budgeting processes.

15 Calculated from Annual Reports, Commissioner of the General Land Office, 1875–1920,Google Scholar and Annual Report, Secretary of the Interior, 1920–1933.Google Scholar

16 Annual Report, Secretary of the Interior, 1930, p. 8.Google Scholar