The Hoover Institution, in partnership with the Arthur M. Blank Family Foundation (ABFF), vetted ideas under Montana’s big sky at the Markets vs. Mandates for the Environment and Energy workshop, held September 5–8 at the foundation’s West Creek Ranch in Emigrant, Montana, twenty-five miles north of Yellowstone National Park.

The workshop was co-led by John and Jean De Nault Senior Fellow Terry Anderson and Ilene and Morton Harris Visiting Fellow Dominic Parker. It was attended by twenty-four scholars and practitioners with expertise in environmental and energy policy, including Hoover senior fellows Steven Koonin and James Sweeney. The participants debated workshop readings on the effectiveness of market-based versus government-mandated actions for improving the environment and producing clean energy, and they proposed new research ideas during breaks for reflection and outdoor activities. 

Parker and Peter Brown of the ABFF gave welcoming remarks prior to the opening dinner on September 5.

On September 6, the workshop kicked off with two discussion sessions. Anderson and Visiting Fellow Matthew Kahn led “Thinking Clearly about Markets vs. Mandates,” probing questions such as: What is the boundary between markets and mandates when markets are regulated, taxed, and subsidized? And by what criteria do we compare how markets perform under different constraints? The second session, “Intended and Unintended Consequences of Mandates,” was led by Parker and Gary Libecap, professor emeritus of economics at the University of California–Santa Barbara (UCSB). During the session, Parker and Libecap assessed why the enforcement of well-intended environmental policies such as the Clean Air Act and the Endangered Species Act can sometimes backfire and make conditions worse, and why corporations support environmental regulations that raise their costs.

Two afternoon sessions followed lunch and an activity break. Todd Henderson, visiting fellow, and Daniel Phaneuf, professor of applied economics at the University of Wisconsin, led the discussion “Environmental Markets and Markets for Climate Mitigation.” The conversation focused on metrics to evaluate how well voluntary agreements perform when compared to top-down government regulations. They also discussed when markets are aided or discouraged by government policy. Holly Fretwell, the workshop’s coordinator and author of books and papers covering environmental policy topics, concluded the workday by leading a pre-dinner reflection, “What Is Unseen,” asking participants to look for hidden costs and benefits of energy and environmental policies.

The sessions on September 7 evaluated markets and mandates for energy transitions. Koonin and Lance Gilliland, a managing director in investment banking at Perella Weinberg Partners, highlighted what science and economics can tell us about the necessity, desirability, and feasibility of a rapid global transition to net-zero carbon emissions. The session raised questions about how markets can better guide an appropriately paced transition.

Following a lakeside picnic lunch on the ranch, the focus turned to energy transitions within the United States. Neil Chatterjee, commissioner and chairman of the Federal Energy Regulatory Commission under President Trump, and Stephenson Policy Fellow David Fedor led the discussion. The conversation assessed the feasibility and broader costs and benefits to Americans of a transition prescribed to renewables, and it assessed the extent to which permitting and regulatory obstacles prevent willing buyers and sellers from expressing their preferences for renewables or fossil fuels via markets.

The next session, “Applications to the American West,” was appropriate given the workshop setting in Montana. It was led by Paasha Mahdavi, an associate professor of political science at UCSB and 2021–22 Campbell Visiting Fellow, and David Sickey, former tribal chairman of the Coushatta Tribe of Louisiana. This discussion focused on questions such as: Should markets dictate resource use on federal land, including where firms decide to locate renewable projects? Are Western communities particularly exposed to transitions away from fossil fuels? And what role will tribes play in energy transitions?  

Fretwell wrapped up the day by leading an outdoor session, “Transitions,” in which she asked participants to brainstorm barriers that impede environmental improvements.

The workshop concluded with breakfast on September 9.

Over the course of the week, the diverse set of participants evaluated the possibilities and limits of market solutions to critical environmental and energy challenges. As codirector Dominic Parker put it, the workshop “was a crash course on how government can help or hinder environmental conditions.”

Workshop Agenda

September 6
Session 1: “Thinking Clearly about Markets vs Mandates”
Discussants: Terry Anderson and Matthew Kahn
Session 2: “Intended and Unintended Consequences of Mandates”
Discussants: Gary Libecap and Dominic Parker
Session 3: “Environmental Markets and Markets for Climate Mitigation”
Discussants: Todd Henderson and Daniel Phaneuf
Discussion: “What Is Unseen”
Moderator: Holly Fretwell

September 7
Session 4: “Energy Transitions, Part 1 (Global)”
Discussants: Lance Gilliland and Steve Koonin
Session 5: “Energy Transitions, Part 2 (United States)”
Discussants: Neil Chatterjee and David Fedor
Session 6: “Applications to the American West”
Discussants: Paasha Mahdavi and David Sickey
Discussion: “Transitions”
Moderator: Holly Fretwell


Terry Anderson, Hoover Institution; Sanjai Bhagat, University of Colorado; Peter Brown, Arthur M. Blank Family Foundation; Neil Chatterjee, Hogan Lovells; Dora Costa, UCLA; James Curley, Xchange 365; Shana Farley, Hoover Institution; David Fedor, Hoover Institution; Holly Fretwell, Property and Environment Research Center; Lance Gilliland, Perella Weinberg Partners; Todd Henderson, University of Chicago and Hoover Institution; Rhiannon Jerch, University of Wisconsin; Akshaya Jha, Carnegie Mellon University; Sarah Johnston, University of Wisconsin; Matthew Kahn, University of Southern California and Hoover Institution; Daniel Kessler, Hoover Institution; Steven Koonin, New York University and Hoover Institution; Gary Libecap, UCSB; Paasha Mahdavi, UCSB; Dominic Parker, University of Wisconsin and Hoover Institution; Daniel Phaneuf, University of Wisconsin; David Sickey, Sickey Global Strategies LLC; James Sweeney, Hoover Institution; and Jeremy Weber, University of Pittsburgh.

The Hoover workshop at West Creek Ranch was made possible by the generosity of the Arthur M. Blank Family Foundation.

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