Citation

Kaffine DT. J. Law Econ. 2009; 52(4): 727-743.

Copyright

(Copyright © 2009, University of Chicago Press)

DOI

10.1086/605293

PMID

unavailable

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 non-locals 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.

Surfing in California has typically been associated in the popular zeitgeist with the image of laid-back surfer dudes and dudettes "hangin' ten" and soaking up the warm sun. But surfing in California has a less pleasant side: localism. Even though the law defines the coast as open access up to the high-tide mark, surfers at many breaks enforce informal property rights. It has been noted that many longtime surfers feel that they own a break after surfing it for years and display varying degrees of hostility to nonlocals who try to surf their prized spots. In the surfing context, hostility toward nonlocals often takes the form of aggressive maneuvers on the waves, verbal abuse, or even physical confrontation.

Oftentimes, surf breaks have well-defined zones in which waves routinely break, which leads to an informal lineup of surfers in the water taking turns catching waves. While dropping in front or behind another surfer after they have claimed a wave is typically a gross breach of etiquette, those techniques may also be used by locals to intimidate or just ruin the day of nonlocals. Off the waves, localism at its worst can take the form of broken surfboard fins, slashed tires, broken windows, or even physical violence.