Free-market environmentalism argues that the free market, property rights, and tort law provide the best means of preserving the environment, internalizing pollution costs, and conserving resources.
[5] Libertarian Georgists (or Geolibertarians) maintain a strong essential commitment to free markets but reject the Coasian solution in favor of land value taxation, wherein the economic rent of land is collected by the community and either equally distributed to adult residents in the form of universal basic income, called the citizen's dividend, or used to fund necessary functions of a minimal government.
Geolibertarians regard the LVT as just compensation for a legal land title granting exclusive access to that which logically precedes and generates private capital, whose supply is inelastic, which properly belongs to all, and to which all have an equal right because it is vital to human existence and economic activity—the ground itself—and thus consider land value capture both morally imperative and a natural source of revenue.
Geolibertarians generally also support Pigouvian taxes on pollution and fees as compensation for natural resource extraction, negative externalities which adversely affect land values in particular.
(Toward a Reconstruction of Utility and Welfare Economics PDF) Murray Rothbard himself believed the term "free-market environmentalism" to be oxymoronic.
On his view the unimproved natural environment, undeveloped and unowned, can in no sense be considered property until it is transformed via Lockean homesteading.
Unlike geolibertarians and many classical liberals, however, Rothbard emphatically rejected Locke's proviso as inconsistent with his theory of property acquisition.
They despise and condemn the human race, which by its very nature and in contrast to other creatures, changes and transforms the environment instead of being passively subjected to it....I have come to the conclusion that a 'free-market environmentalist' is an oxymoron.
"[7] Recent arguments in the academic literature have used Friedrich Hayek's concept of a spontaneous order to defend a broadly non-interventionist environmental policy.
[11] It is contended that if the fishery had been owned by a single entity, the owner would have had an interest in keeping a renewable supply of fish to maintain profits over the long term.
Another example is in the 19th century early gold miners in California developed a trade in rights to draw from water courses based on the doctrine of prior appropriation.
Increasing difficulties in meeting demand for water in the western United States have been blamed on the continuing establishment of governmental control and a return to tradable property rights has been proposed.
[12] They see natural resources as too difficult to privatize (e.g. water), as well as legal responsibility for pollution and degrading biodiversity as too hard to trace.