property rights externalities and resource degradation locating the tragedy abstract resource degradation in the third world is largely driven by the demands of farm households for fuelwood and land for agriculture since resources are often controlled through indigenous systems of property the tragedy of the commons has been used to explain resource degradation as a result private property is suggested as a solution to resource degradation a dynamic model capable of examining household incentives for resource use under private and common property is developed results of the model reject the conventional wisdom that gives rise to the presumed optimality of private individual property in natural resources and the correlated indictment of group management regimes

bioeconomics of sustainable harvest of competing species abstract the concept of maximum sustainable yield frontier msf is applied to a gause model of competing species maximizing the present value of economic rent under costless harvesting with positive discount rate implies optimal stock levels below the locus of msf stocks maximizing economic rent with positive harvesting costs and zero discount rate implies optimal stock levels above the locus of msf stocks it is shown how the optimal steady state stock levels are altered by changes in the exogenous discount rate harvest prices and harvest costs optimal harvesting might imply harvesting of one of the two species at a loss

externalities expectations and pigouvian taxes this article derives pigouvian type corrective measures for reciprocal externalities when non nash behavior characterizes the participants these reciprocal externalities may involve various kinds of environmental pollutants such as acid rain a comparison between corrective measures for nash and non nash behavior demonstrates that positive conjectures regarding the other agent s externality generating activity have an expectation internalizing influence that usually reduces the required corrective measures negative conjectures e g free riding expectations however have an expectation externalizing effect that increases the required corrective measures the article analyzes both two person and n person externalities 13 references 3 figures 1 table

heterogeneity returns to scale and collective action i analyze the effects of resource inequality and valuation heterogeneity on the provision of public goods with increasing or decreasing returns to scale in production the existing literature typically takes the agents characteristics as given and known to the researcher in contrast this paper compares collective action provision across groups of agents with resources and valuations for the public good drawn from different known joint distributions specifically i characterize the expected equilibrium public good level as function of various distributional properties and moments a resource valuation distribution that first order stochastically dominates another distribution always results in higher expected public good provision level independent of the production technology with decreasing returns to scale in the public good production higher resource inequality results in higher expected provision with increasing returns the same result holds when the mean resource level is relatively low but expected provision decreases in inequality when the mean resource level is high a parallel result holds for agents valuations l auteur analyse les effets de l inegalite des ressources et de l heterogeneite dans l evaluation de biens publics dont la production se fait avec des rendements croissants et decroissants a l echelle la litterature specialisee suggere habituellement que les caracteristiques des agents sont donnees et connues du chercheur a contrario ce memoire compare l action collective de groupes d agents dont les ressources et les evaluations du bien public sont tirees de distributions conjointes connues specifiquement le niveau d equilibre anticipe du bien public est fonction de divers moments et proprietes de ces distributions une distribution conjointe ressources evaluations qui en domine une autre au sens stochastique de premier ordre resulte toujours en un niveau de bien public anticipe plus eleve quelle que soit la technologie de production quand les rendements a l echelle sont decroissants une inegalite de ressources plus grande resulte en un niveau de bien public anticipe plus eleve quand les rendements sont croissants le meme resultat s ensuit si le niveau moyen de la ressource est relativement bas mais le niveau de bien public anticipe decroit quand le niveau moyen de la ressource est eleve des resultats paralleles sont notes pour ce qui est des evaluations du bien public par les agents

the theory of public goods non nash behaviour abstract most treatments of equilibrium public goods provision assume zero conjectural variations in the sense that each individual regards the behaviour of the rest of the community as independent of his own this paper introduces nonzero conjectural variations into the model a diagram is introduced which can depict both the individual s and the community s equilibrium in the presence of nonzero conjectural variations equilibrium and optimal outcomes are compared and a specific functional form is used to investigate the effect of community size on the nature of equilibrium finally we discuss the requirement that conjectures should be consistent

state sponsored violence as a tragedy of the commons england s privateering wars with france and spain 1625 1630 the tragedy of the commons is the familiar problem that open access to a common property resource leads to overexploitation and to zero profits a commons model is applied to an example of state sponsored private violence the practice of privateering or licensed piracy it is predicted that the presence of uncertainty about the value of the prey will reduce the amount of exploitation effort and that industry profits may be positive due to both uncertainty and heterogeneous exploiters using data from england s wars with france and spain between 1625 and 1630 the model suggests that the commons represented by enemy merchant shipping was not overexploited and that privateering profits were positive the dynamic paths of privateering effort ships seized and individual firm profits were however consistent with the normal expectation that commons exploitation will peak and fall as competition drives down returns through entry

the commons and the optimal number of firms the problem of the commons is a frequently cited example of market failure in which exploiters pursuit of profits does not lead to the attainment of a social or pareto optimum in particular a free access equilibrium induces an unrestricted number of exploiters or firms to equate the variable input s average product instead of its marginal product to the input s real rental rate hence the rents of the variable input are driven to zero haveman 1973 1 when the number of firms in a commons is unrestricted the scarce factor e g the fishery the hunting ground is not imputed a rent a social optimum can be achieved if a single firm exploits a commons and sells its output in a perfectly competitive market weitzman 1974 the purpose of this note is to derive an expression for the optimal number of firms exploiting a commons when the resulting output is sold in an imperfectly competitive market 2 since demand inelasticity due to monopoly power leads to overconservation while an increase in the number of exploiting firms typically leads to underconservation a finite number of firms for a commons can be found corresponding to a social or pareto optimum in particular the optimum number of firms depends directly on the elasticity of the input productivity and inversely on the price elasticity of market demand

common pool equities an arbitrage based non cooperative solution to the common pool resource problem abstract it is proposed that a new type of property right termed a common pool equity can solve the common pool resource problem this equity may be presented to any firm that extracts from the resource for a share in profits it is shown that a profit arbitrage condition ensures that the market and socially efficient solutions correspond whenever market power is absent the cost externalities are fully internalized

pure public goods versus commons benefit cost duality sandler and arce 1 pure public goods versus commons benefit cost duality by todd sandler school of international relations university of southern california von kleinsmid center 330 los angeles ca 90089 0043 tsandler usc edu 213 740 9695 213 742 0281 fax and daniel g arce m department of economics rhodes college 2000 n parkway memphis tn 38112 1690 arce rhodes edu 901 843 3121 901 843 3736 fax final revision november 2002 sandler is the robert r and katheryn a dockson professor of international relations economics university of southern california and arce is the robert d mccallum distinguished professor of economics business rhodes college sandler s and arce s research was funded through the dockson and mccallum endowments respectively we have profited from the helpful comments of two anonymous referees

on the social efficiency of conflict abstract in sharp contrast with the economic literature on conflict this paper shows that confrontation may be efficiency enhancing conditions are derived under which a contest over the exclusive control of a resource pareto dominates peaceful access

endogenous conjectural variations in oligopoly abstract conventional oligopoly theories provide no mechanism for oligopolists to learn from their experience of other firms behavior in forming conjectural variations this paper explores two approaches to the solution of this problem in the first the consistent conjectures approach oligopolists passively react to changes in other firms outputs so as to keep their own profits at a maximum other firms correctly anticipate these reactions in the second approach the matching behavior approach firms actively choose reactions which will induce other firms to reduce their outputs again these reactions are correctly anticipated by the other firms the implications of these alternative models are derived and contrasted with the implications of the cournot and joint profit maximization models

tropical deforestation markets and market failures activities to curb deforestation yield private goods country specific public goods and global public goods markets can operate for the private goods while nations are motivated to strike bargains with one another over country specific public goods suboptimality stems from the global public goods and the positive externalities associated with preservation activities this suboptimality can be attenuated if the developed countries establish property rights to genetic material gathered from the rain forests since much of the global public benefits is derived by the developed countries they are in a weak bargaining position with respect to the shrinking rain forests

fuelwood subsistence foraging and the decline of common property abstract ideally common property can adapt to particularities in the social and physical environment to create environmentally sustainable regimes in practice common fuelwood foraging has been subject to numerous problems intimately linked to the historically changing role of common property schematic histories of fuelwood and forests in europe and java illustrate how common property systems have been undermined and the different implications their dissolution can have both cases indicate that fuelwood problems may be best interpreted within the rubric of subsistence foraging and the decline of common property rather than that of energy shortage and tree mismanagement

harvest uncertainty and the tragedy of the commons abstract this paper demonstrates that a fixed number of risk averse firms faced with harvest uncertainty owing to resource stock uncertainty will typically reduce their exploitation of a commons in addition the total exploitation of the industry will decrease when entry is permitted and uncertainty is compared with certainty this result holds for perfectly competitive output markets and also characterizes imperfectly competitive output markets with linear market demand and risk neutral firms in the latter case the socially optimum number of firms is determined based upon the degree of uncertainty the price elasticity of market demand and the elasticity of input productivity

the efficiency of the forward exchange market in this note we test the efficiency of the forward market for foreign exchange for the uk pound us dollar exchange rate using residuals from the lus class we show that previous rejections of efficiency in the forward market have not been due to the use of residuals from the ols class

centralized and decentralized management of local common pool resources in the developing world experimental evidence from fishing communities in colombia this paper uses experimental data to test for a complementary relationship between formal regulations imposed on a community to conserve a local natural resource and nonbinding verbal agreements to do the same our experiments were conducted in the field in three regions of colombia each group of five subjects played 10 rounds of an open access common pool resource game and 10 additional rounds under one of five institutions communication alone two external regulations that differed by the level of enforcement and communication combined with each of the two regulations our results suggest that the hypothesis of a complementary relationship between communication and external regulation is supported for some combinations of regions and regulations but cannot be supported in general we therefore conclude that the determination of whether formal regulations and informal communication are complementary must be made on a community by community basis

collective contests for commons and club goods abstract this paper focuses on collective contests for commons and club goods our main objective is to examine in this context the effect of group size on its performance the main results specify conditions for the existence non existence of the group size paradox namely the situation where a larger group is less more effective in pursuing its interest because of despite the combined effect of the incentives that result in the free riding problem and the tragedy of the commons the paper also explains under what circumstances there exists a bias towards excessive or inadequate winning group size finally it examines the effect of restricted excludability of the commons good within the winning group on the relationship between group size and its winning probability

can inventory chaos be welfare improving abstract this study demonstrates the possibility that chaotic fluctuations may be preferable to a steady state for this purpose it uses a simple macro disequilibrium model in which inventory can be chaotically fluctuated in such a model the profit of a firm as well as the utility of a consumer fluctuates this raises the question of their average profitability and preferability in the long run this study with the aid of numerical examples demonstrates that the long run average profit can be greater than the profit obtained at the steady state while the long run average utility is the same as the utility obtained at the steady state

what motivates common pool resource users experimental evidence from the field this paper develops and tests several models of pure nash strategies of individuals who extract from a common pool resource when they are motivated by a combination of self interest and other motivations such as altruism reciprocity inequity aversion and conformism we test whether an econometric summary of subjects strategies is consistent with one of these motivations using data from a series of common pool resource experiments conducted in three regions of colombia as expected average extraction levels are less than that predicted by a model of pure self interest but are nevertheless sub optimal moreover we find that a model of conformism with monotonically increasing best response functions best describes average strategies our empirical results are inconsistent with models of altruism reciprocity and inequity aversion

harvesting preemption industrial concentration and enclosure of national marine fisheries this paper explores how harvesting technology can affect firms internalisation of common pool externalities and the incentives for expanding firm s size focusing on supply side non pecuniary externalities our closed entry harvesting competition model suggests that when marginal harvesting costs are weakly sensitive to common pool externalities atomistic competition is likely to remain other things equal as the predominant industrial structure in the fishery the avenue for increasing industrial concentration is modelled via stackelberg leadership which offers the option of preempting rivals production in our static modelling a fishery subject to stackelberg signalling results in higher overfishing versus the case of a highly decentralised harvesting sector proxied by the use of nash conjectures given that static optimising behaviour could be interpreted as a result of entry controls and other fishing regulations being widely perceived as ineffective controls the obtained overfishing ranking suggests that in fisheries where strategic preemption in production is feasible but where entry controls and other important regulations on fishing effort are considered to be ineffective overfishing is likely to remain the predominant outcome even if other incentives promote evolution towards a more concentrated industry structure when the fishery is already overpopulated by numerous small firms whatever advantages large firms may have in terms of profitability numerous small scale fishermen tend to make up for in the political arena this imposes constraints on the politically feasible fishing regulations we use a second best welfare benchmark to illustrate resulting policy trade offs

a non cournot model of voluntary collective action the interaction of selfish rational actors in the provision of a public good is analyzed in an attempt to explain recent experimental findings as well as real world cases of voluntary collective action the model which allows for more sophisticated behavior than that assumed by the conventional cournot theory predicts a higher level of collective action that that theory the impacts of income effects and of the price elasticity of demand for the public good are given special emphasis