Several sets of economists have written papers on the unintended consequences of the Endangered Species Act . These papers document that land owners crush the "natural capital" before the Act seizes (without compensation) their land. This preemption protects the land owner but depletes the environment. Today the New York Times documents that this same dynamic is playing out in New York City. Land owners who want to demolish an old building to build a "Don Trump" like tower anticipate that the New York City Landmark Preservation Commission may designate their property as a historic landmark. Land Owners lose development rights when this occurs (just like with the Endangered Species Act) and respond to this by demolishing the building early so that there is nothing left to preserve.


Switching gears and turning to chicken poop. The NYT also has an interesting
article
on the production of Chicken Poop in Maryland. What interests me here is public health consequences of economic growth at the agricultural/suburban spatial border. As suburbia grows, there are more people and more rich people living closer to agricultural areas. If a byproduct of agriculture is nitrogen fertilizer runoff and this gets dumped into the water and air, then public health issues arise.

How the Coase Theorem plays out here is an open question. The first issue of course is property rights. Do the farmers have the right to use any amount of chicken poop that they please? How much do the downwind suburban victims suffer from these private profit maximizing actions?

This is a very interesting excerpt of the article;

"Storm runoff from urban areas, lawn fertilizers and pollution from cars and sewage treatment plants also play major roles in polluting the bay. But Environmental Protection Agency officials say that agriculture is the largest single source of pollutants and sediment in the Chesapeake Bay, accounting for over 40 percent of the nitrogen and phosphorous and over 70 percent of the sediment.

State officials say that animal manure produces more phosphorus and nearly the same amount of nitrogen pollution as all human wastewater from treatment plants in the state.

Although the dairy and hog industry in states near the bay produce more pounds of manure, poultry waste has more than twice the concentration of pollutants per pound. Reducing pollution from agriculture is also about a tenth as costly as it is to achieve the same reductions from urban development, state and federal environmental officials say.

“The reason to focus on poultry,” said Tom Simpson, executive director of Water Stewardship, an environmental nonprofit agency, “is that sewage treatment plants have already been required to reduce their pollution and storm water runoff from cities and large dairy and hog farms have permits that can be used to limit their water pollution.”

But in the past two decades, the poultry industry has carved a special role for itself in terms of the oversight it receives, and it has twice defeated state efforts to impose permits."