Land management can have huge impacts on everything from flood risk, biodiversity, public access and carbon sequestration in soils. All of these things are very important to us as a society, but often we have little or no influence on how the land is managed, depending on who owns it and what their priorities are. While we can try to pass laws to restrict environmental pollution, how to incentivise positive environmental outcomes is sometimes more difficult.
The UK’s water industry is a good example of how variety in land ownership affects how you incentivise good behaviour. The water companies need to make drinking water out of whatever water turns up in the rivers and reservoirs they abstract from. If this water is already fairly clean, their job is easier. But if it’s full of pesticides or other pollution, their job is going to be much harder. This situation can come about because the people causing the pollution (farmers, in the example of pesticides) are not the people who have to deal with the clean-up downstream.
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