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Evolving Entitlements: Intervening To Prevent A Collective Harm

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  • Brookshire, David S.
  • Ganderton, Philip T.
  • McKee, Michael

Abstract

When market transactions generate negative externalities, the injured party may initiate court action to prevent harm or to obtain compensation. The political response, in some cases, has been to broaden the set of agents who can intervene through the court, often by admitting entirely new categories of potential intervenors. We employ an experimental market setting to investigate the effect of an increase in the number of potential intervenors (introduced as admitting an additional class of persons having the necessary standing in law). The results suggest that there will be a substantial increase in the number of actual interventions. The increase means that social resources expended on interventions will increase and there may be a consequent reduction in trading activity in the affected markets.

Suggested Citation

  • Brookshire, David S. & Ganderton, Philip T. & McKee, Michael, 1996. "Evolving Entitlements: Intervening To Prevent A Collective Harm," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 21(1), pages 1-14, July.
    • Handle: RePEc:ags:jlaare:30991
    DOI: 10.22004/ag.econ.30991
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    References listed on IDEAS

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    1. Smith, Vernon L, 1982. "Microeconomic Systems as an Experimental Science," American Economic Review, American Economic Association, vol. 72(5), pages 923-955, December.
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