The plasticity of property: legal transitions between property rights regimes for different resources

Property law has systems that are entirely private, entirely open, and everywhere in between. A purely open regime poses no holdout problems, but it can suffer from overutilization of common resources. Conversely, a purely private regime faces serious problems with external harms to neighbors. The holdout problems can be mitigated only by increasing externality problems and the reverse. The challenge is to minimize these joint but countervailing risks by first minimizing the major risk and then correcting for lesser ones. Water thus begins as a common resource, which may be privatized temporarily by building huts for refuge during storms. Likewise, property landowners temporarily lose their right to exclude when others have to take refuge during storm. Necessity - defined narrowly to deal with the imminent peril to life or property - thus suspends property rights. Necessity may also operate on a permanent scale when technological changes alter the relative balance of the holdout and externality risks, as with aviation, fishing, and mining. Imposing new schemes then raises questions of explicit or implicit compensation to former users of particular resources.