Professors' Paper on Economics of National Monuments Earns Research Award

One of the most hotly contested issues surrounding federally protected land, especially national monuments, is the economic impact to the residents of adjacent communities. Critics of national monuments claim that these designations harm local economies by cutting off access to key industries such as logging, mining, or oil and gas extraction. Proponents of national monuments claim that increased tourism makes up for the potential losses at great benefit to the environment.

These debates are especially relevant in the western United States, including Utah, as these states contain millions of acres of federally owned land. The state of Utah contains six national monuments in addition to five national parks and other public lands.

Two researchers  in the Department of Applied Economics at Utah State University — Professor Paul Jakus and Assistant Professor Sherzod Akhundjanov — decided to test those claims by studying per capita income at the county level. Inspired by the controversy surrounding Bears Ears National Monument in southeastern Utah, Jakus and Akhundjanov first studied the counties surrounding its neighbor, Grand Staircase-Escalante National Monument.

“We looked at previous studies that had been done in this area, studying the effect of national monuments on regional economies’ growth, and saw that there was actually a dearth of studies in this area,” Akhundjanov said. “That was the primary motivation that pushed us to tackle this topic in the first place.”

When their first paper, published in 2017, found that the designation for Grand Staircase-Escalante had no effect on regional per capita income. Intrigued by these findings, the team decided to expand their research and potentially find more generalizable results by studying data from 20 counties containing part of nine large national monuments. The monuments involved included Carrizo Plain, Giant Sequoia, Santa Rosa and San Jacinto Mountains, Canyon of the Ancients, Upper Missouri River Breaks, Cascade-Siskiyou, Newberry, Mount St. Helens, and Hanford Reach.

Reviewing economic data from the five states — California, Colorado, Montana, Oregon, and Washington — Jakus and Akhundjanov again found no evidence that monument designation affected per capita income in any of the counties studied. Their paper, The Antiquities Act, National Monuments, and the Regional Economy, was published in May 2019 in the Journal of Environmental Economics and Management.

“What's happening here is, of course, some industries might have been hurt but other industries might have benefited from the monument designation,” Akhundjanov said. “The key feature is in this paper we get the overall regional effect, and when you look at the net effect it is zero.”

“All the uses that are already involved or ongoing in national monuments are allowed to continue,” Jakus said. “So if you're drilling oil on federal land that then subsequently becomes a national monument you're still allowed to drill oil. You're just not allowed to expand that oil field if you want to. The way it’s done minimizes the negative effect, leaving the positive effect but the positive effect is still relatively small.”

For their work and the years of research these papers represent, Jakus and Akhundjanov have been recognized by the Western Agricultural Economics Association with the year’s Outstanding Published Research Award. The award was presented at the association’s Annual Meeting, held virtually from June 29 – July 1, 2020.

Jakus and Akhundjanov both expressed their gratitude for the recognition and pleased that their research has inspired other detailed studies on public lands at the microeconomic level. They said that National Monuments and Economic Growth in the American West, a study conducted by Margaret Walls and her colleagues working for Resources for the Future, was a perfect follow-up to their papers.

“You can think of this as us looking at the economic data with our unaided eyes at the county level,” Jakus said. “They were able to get a microscope and look at the firm level. When they did that, they found small positive employment effects. I thought it was just a wonderful follow to our work.”

Concerning their ongoing research, Jakus said, “What do public lands mean for urban areas? That's the question Sherzod and I have moved on to. Having tried to measure employment and income effects in rural areas with national monuments, now it's more generally, using the data that we have available to us, can we answer this question about more urban areas.”