I suspect you're right that there's no institutional or technocratic silver bullet to managing commons well. There's no substitute for an active, engaged citizenry, holding its political institutions accountable.

That's why we're screwed.

grist.org

Design a market in which every actor pays all their own costs -- including externalities -- and receives no special favors, and we're good.

In such a pure free market, good economic decisions are good ecological decisions. This is controversial, but to me it seems all but tautological.

grist.org

If an argument is tautological, that itself is a strike against it -- it is untestable.

Also some of the conditions you set our impossible. The other edge of externalities are public goods, which by nature are undervalued by markets, and thus have to be provided by non-market institution without having the "right price" or the "right quantity" of these goods available. Transportation is a public good. You don't get right of ways for auto roads or rail or bike paths, or even walking paths without the ability to publicly take them of people refuse to sell them. Alternatives to transportation such as telecommuting require wires or use of wireless electronic spectra - which are also involve public takings from a commons. So we end inevitably supporting one actor over another. In the U.S. the favored transport actors have been cars, trucks and airplanes. But favoring rail, and high density development, and telecommuting will also require favoring one actor over another. There is not magic crystal ball out there telling us what the "right" balance is. We have to decide.

Further there will be real debates over managing commons. For example in water short areas you will have to debate the both empirical questions and questions of value. Empirical question: what is the maximum we can safely draw from a particular water table in year? How safe is "safe"? Value question: do we want to to draw that maximum (which in most water tables in probably significantly less than is currently being drawn)? Or do we want to lower our draw to the point that water tables that have been mined over the years, drawn way below their natural levels, are slowly recharged?

Education is another example. How much funding for education do we provide? How much of that funding should come from the parents of kids being educated, how much from people whose kids are grown , or who don't have kids, but who were once publicly educated themselves? Again this is partially a matter of values: in what sense are all children your children?

I have a real problem with this assumption Barnes makes: "[I]f there is only so much atmospheric space to go around, who does it belong to? He concluded that it belongs to the human race -- that each person should get an equal share of emissions." And it goes downhill from there.

So you're an environmental economist...that means you yabber on about the environment while still operating within the flawed rubric of classical economics...

I don't see how that helps anything.

Ecological economics...that's another story.

NJD

Galbraith was also one who, long ago, started calling our economy "post-capitalist" (with a new set of concerns).

IMO, "capitalist" like "free market" arguments are all about false dichotomies.

We have a regulated market economy, with as Galbraith noted power resting more among "mangers" than "capitalists."

sounds like a good idea for a list of books/articles.  By the way, Hawken's newest, "Blessed Unrest", is very powerful, if only tangentially related to economics.