Ecosystem services such as clean water from forests are free, but now their value is being recognized. Entrepreneurs are developing markets for these services and providing incentives for conservation.
In the early twentieth century, L.A. purchased water rights by buying up farmland and conveying the water back to L.A. These purchases created a legacy of distrust and suspicion, as people began to view the trades as theft. Gary Libecap takes a second look at the L.A.-Owens Valley transfers.