Golden Rules: The Origins of California Water Law in the Gold Rush (Markets and Governments in Economic History)

Fresh water has become scarce and will become even more so in the coming years, as continued population growth places ever greater demands on the supply of fresh water. At the same time, options for increasing that supply look to be ever more limited. No longer can we rely on technological solutions to meet growing demand. What we need is better management of the available water supply to ensure it goes further toward meeting basic human needs. But better management requires that we both understand the history underlying our current water regulation regime and think seriously about what changes to the law could be beneficial. For __Golden Rules,__ Mark Kanazawa draws on previously untapped historical sources to trace the emergence of the current framework for resolving water-rights issues to California in the 1850s, when Gold Rush miners flooded the newly formed state. The need to circumscribe water use on private property in support of broader societal objectives brought to light a number of fundamental issues about how water rights ought to be defined and enforced through a system of laws. Many of these issues reverberate in today’s contentious debates about the relative merits of government and market regulation. By understanding how these laws developed across California’s mining camps and common-law courts, we can also gain a better sense of the challenges associated with adopting new property-rights regimes in the twenty-first century. This book examines the origins of California surface water law in the earliest years of statehood: the decade of the 1850’s. This decade was dominated by a key event in California history, the Gold Rush. The Gold Rush comprised a major exogenous shock to the California economy, resulting in tremendous economic and population growth within an extremely short period of time, along with significant structural changes to the economy. Importantly, the Gold Rush caused a dramatic increase in the demand for water, a key factor input into placer mining. The increased use of water led to a large number of disputes among miners over its use, which set into motion a series of changes in how water rights were defined and how disputes over water rights were to be resolved. The emergence of California water law was a complex process that contained both formal and informal elements. A key component of the picture was the creation of basic legal principles within a network of mining camps. Many of these principles were subsequently incorporated into the official system of water law as promulgated by the courts. This book examines legal developments that governed disputes in three key areas: diversions of water, water quality, and dam failures. The resulting principles were broadly consistent with attempts to maximize rents within local water basins, including the minimization of various components of transaction costs, including enforcement and measurement costs "Fresh water has become scarce and will become even more so in the coming years, as continued population growth places ever greater demands on the supply. At the same time, options for increasing that supply look to be ever more limited. No longer can we rely on technological solutions to meet growing demand. What we need is better management of the available water supply to ensure it goes further toward meeting basic human needs. But better management requires that we both understand the history underlying current water regulation and think seriously about what changes to the law could be beneficial. In Golden Rules, Mark Kanazawa draws on previously untapped historical sources to trace the emergence of the current framework for resolving water rights issues to California in the 1850s, when Gold Rush miners flooded the newly formed state. The need to circumscribe water use on private property in support of broader societal objectives brought to light a number of fundamental issues about how water rights ought to be defined and enforced through a system of laws. Many of these issues reverberate in today's contentious debates about the relative merits of government and market regulation. By understanding how these laws developed across California's mining camps and common-law courts, we can also gain a better sense of the challenges associated with adopting new property rights regimes in the twenty-first century"--Book jacket Introduction Economic theory and the evolution of water law Water and the technologies of mining Watering the diggings: the development of the ditch industry The informal law of the mining camps Origins of the common law of mining and water rights The origins of prior appropriation Water quality and the law of nuisance Bursting dams and the law of nuisance Conclusions.