Regulatory Takings: Law, Economics, and Politics

Are rent controls and zoning regulations unconstitutional? Should the Supreme Court strike down the Endangered Species Act when its administration interferes with the use of private property? These questions are currently debated under the doctrine of regulatory takings, and William Fischel’s book offers a new perspective on the issue. Regulatory Takings argues that the issue is not so much about the details of property law as it is about the fairness of politics. The book employs jurisprudential theories, economic analysis, historical investigation, and political science to show why local land use regulations, such as zoning and rent control, deserve a higher degree of judicial scrutiny than national regulations. Unlike other books on this topic, Regulatory Takings goes beyond case law to buttress its arguments. Its reality checks range from reviews of statistical evidence to local inquiries about famous takings cases such as Pennsylvania Coal v. Mahon and Lucas v. South Carolina Coastal Commission. The gap between legal theory and on-the-ground practice is one reason that Fischel investigates alternative means of protecting property rights. Local governments are often deterred from unfairly regulating portable assets by their owners’ threat of “exit” from the jurisdiction. State and federal government regulations are disciplined by property-owner coalitions whose “voice” is clearly audible in the statehouses and in Congress. Constitutional courts need to preserve their resources for use in areas in which politics is loaded against the property owner. Regulatory Takings advances an economic standard to decide when a local regulation crosses the border from legitimate police power to a taking that requires just compensation for owners who are adversely affected.

Table of Contents:
Preface Introduction 1. Of Coase and Coal: Regulatory Takings in the U.S. Supreme Court 2. Eminent Domain's Democratic Origins and Economics Cycles 3. Constitutional Law, Process Theory, and Democratic Commitment 4. The Economic-Utilitarian Theories of Michelman and Esptein 5. Rational Expectations and Contractarian Conventions 6. Capitalizing on Land Use Regulation: Evidence from California 7. Zoning, Capitalization, and The Efficiency of Local Government 8. How Exit and Voice Discipline Government Excess 9. Remedies for Unfair Land Use Restrictions and Exactions Case References General References Index

About the Author :
William A. Fischel is Professor of Economics, Dartmouth College.

Review :
In this rich volume, Fischel critically assesses the central debates on the regulatory infringement of property rights, the adjudication of disputes surrounding regulatory takings, and the weighing of key values that should be addressed in the process...Fischel takes the reader through a fascinating set of arguments and debates...Regulatory Takings is a fine contribution to the literature. It is logically arranged, coherently argued, and written with flair and humor...Fischel's book [is] likely to assume a place next to other classics in the field and shape future discussions of the takings issue. This volume should be widely read by scholars of public law, law and economics, regulation, and public policy. Fischel's approach...considers not only the legal, economic and political considerations alluded to in his subtitle, but also case-specific and historical assessments of the development of Takings doctrine...Regulatory Takings is a pleasure to read. It is lucid and engagingly written, and achieves accessibility for those who are not experts on Takings without sacrificing sophistication. Regulatory Takings launches a surprisingly energetic shove at property law's most Sisyphean rock...[Fischel has] written a book packed with interesting ideas and marvelous examples, a book that should inform the modern legislative and jurisprudential debate. What's more, his book reads as if the research was simply a lot of fun... Fischel's sheer exuberance in ferreting out data, and his diligence in examining vast numbers of theories, put most land-use scholars to shame...Readers with the slightest interest in takings issues should read Fischel's work for themselves. This book harks back to an era when economists such as John R. Commons believed that economics, politics, and law were part of the same subject, when systematic inquiries into the complexities of social and economic institutions were an important part of the economics profession. The book has the further great advantage that it is written in a clear and occasionally elegant prose style...[T]he great strengths of the book are the high quality of writing, the many fascinating case studies and other details, and the comprehensive coverage of the literature...[I]t should be the starting point for any economist inquiring into the subject [of takings]. Fischel uses local land-use regulation as a vehicle for exploring the relationship of law, economics, and the political process. This he does skillfully and with erudition. His critiques of the writings of leaders in the field of law and economics--Ronald Coase, Robert Ellickson, Frank Michelman, Richard Epstein, and others--provides a useful and balanced presentation of contrasting perspectives from the literature of law and economics. His review of many takings cases is equally stimulating. [W]ell researched, well written, and highly informative. In William Fischel's excellent recent book...[he] journeys far and wide over one of the pivotal questions of our time: What are the permissible limitations on government regulation of private property?...All too often today, economists become mired in abstract theory or trapped by detailed econometric demonstrations. Fischel's readable book avoids both of these unfortunate extremes and concentrates with intelligence and balance on the institutional arrangements at stake in particular cases, with an eye to explaining long-standing practices by sensible, mid-level economic theory. The situation is complicated, but Fischel, who has spent much of his life teaching and acting in this area, is as well qualified to write about it as anyone can be. Unlike Epstein who has strong theoretical views as to what should be done, Fischel's position is basically practical. He feels that landowners whose land is subject to some kind of change that may injure them have two sources of protection, one of which is the use of pressure on democratic elected groups, and the other is the courts. Much of this book is devoted to detailed discussions of where the remedy should lie in specific instances...Anyone interested in this field can find no better guide to what has been done, and what can be done. There is much more of note in Fischel's book than the elaboration of [his] intriguing proposal. For example, no student of land use should miss his detailed discussion of the facts in Pennsylvania Coal v. Mahon. There is much more to that case than we have ever thought before. Additionally, Fischel develops an intriguing theory of cycles in the judicial and legislative willingness to compensate owners when their property is taken...Finally, the book contains an extensive, nontechnical, and superb summary of the law-and-economics literature on various aspects of regulatory takings.