Environmental negotiation: Its potential and its economic efficiency

Abstract

Negotiation is increasingly viewed as a desirable alternative to courtroom conflict between industrialists and environmentalists. The "court battle" is often costly, time-consuming, uncertain, and all-or-nothing; negotiation promises a cheaper, quicker, mutually acceptable outcome. This paper examines the conditions under which there is scope for a negotiated compromise; and it examines the conditions under which a negotiated compromise is economically efficient. Its principal result is a warning: there is no reason to expect that environmental negotiation conducted under threat of court battle will produce a socially desirable outcome.