# Exploring Partnerships between Local Communities and Timber Companies: An Experiment Using the Role-Playing Games Approach

Authors: Herry Purnomo; Philippe Guizol; Guillermo A. Mendoza
Journal: International Journal of Forestry Research
 (2009)

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## Abstract

Cooperation among stakeholders is widely accepted as an effective management strategy. This paper describes an experimental study that explores this cooperation using role-playing games, which is formulated within a multiagent simulation framework. This framework enables participants to take active roles in mimicking the collaborative decision environment and the behaviors and attitudes of the different stakeholders. The paper examines a forest plantation company in South Sumatra, Indonesia, which has cooperated with local communities since 2000.  The experimental pilot study described in this paper explored the role of communication in partnership relationships between the company and the local communities living within and around the surroundings of the company's plantation. These partnerships were explored and analyzed using the gaming approach involving university students taking the role of forest stakeholders, from both the timber company and the local communities. Lessons learned from the game provided the rationale for the establishment of a communication institution called “Forum Sebahu Sejalan.” This formal forum was constituted after a facilitated ex-postinteraction between representatives from the timber company and local communities. Results and observations drawn from the interactions show the potentials of the RPG approach and the formal forum in crafting resilient partnerships among stakeholders.


---

## Body

## 1. Introduction

Principle
22 of the 1992 Rio Declaration on Environment and Development highlights the
importance of local people and their participation in sustainable
development. In forestry, this often
applies to indigenous people or communities living within or nearby forest
concession areas. Consequently, participatory management approaches have been
devised to strengthen the capacity of local forest communities and enhance
their capability to be engaged in participatory management. These approaches often involve different ways
of empowering local communities by allowing them to be actively involved in
planning and decision making. This paper describes an experimental pilot study
that examined participatory management using role-playing games (RPG)
formulated within a multiagent simulation framework where participants take
active roles mimicking the collaborative decision environment and the behaviors
and attitudes of the different stakeholders.


### 1.1. Forest Plantations, Pulp Industries, and Land Disputes

Indonesia’s pulp and
paper industry has rapidly expanded since the late 1980s. The 1998 economic
crisis temporarily slowed the rate of expansion, but by 2000 several pulp mills
were established. Disputes over land between local and customary communities
and forest companies during the Soeharto era (i.e., New Order regime, 1966–1998) were
suppressed by military force. Soeharto’s resignation, and the subsequent
political transition in May 1998, spawned the beginning of community movements
demanding that customary rights be restored, including communal land rights.
Conflicts arose as local communities and companies clashed over (1) the land
appropriation process, (2) environmental impacts, and (3) recruitment of
employees [1].


### 1.2. Multiagent Simulation and Role-Playing Game

For better
management planning purposes, forestry planners and policy makers should be
able to assess the long-term impacts of major activities or policies such as
establishing plantations, or cooperation among stakeholders. Simulation is one
way to explore long-term impacts; in fact, it may be the only viable tool for
making impact assessments particularly if the forest system is large or too
complex. Simulation generally involves the process of developing a simplified
representation of a real-world situation (called the simulation model), and “animating"
it so that stakeholders can envision future scenarios.Multiagent
simulation (MAS) is a promising tool for
examining natural resource management alternatives, and for analyzing
environmental management issues [2]. MAS has desirable features that make it an appropriate “analytical
platform" for the participatory natural resource management. It is
flexible and can accommodate many stakeholders, and it is robust enough to
embrace different management options and types of decision-making procedures
and processes.In general,
cooperation among stakeholders can occur naturally only when individuals cannot
pursue their goals on their own. Agents
or actors may communicate among themselves when they are interested to seek
cooperation in order to achieve a shared goal [3, 4], even
when economic, social, or political objectives may differ. Cooperation is a
dynamic concept that evolves over time, but may or may not survive broader
economic and social trends and changes. Hence, Axelrod and Cohen [5] have
examined the need for adaptive capacities among all stakeholders involved in
the cooperative process.Information
and communication technology has made the world an increasingly complex, yet
smaller, place. Forest stakeholders now have
better access to information. They also view themselves and others to have to
deal with more variables, issues, and concerns in order to manage their forests
more effectively. With more and better information, forest stakeholders are now
in a position to examine and possibly improve cooperative arrangements and
institutions. While cooperation should be adaptive, it also needs a certain
amount of resilience to be effective in a dynamic world. Role-playing games
(RPGs) are a useful approach to scrutinize partnership and cooperative
arrangements and examine the capacity for adaptation.In general
terms, a game is an action that triggers a reaction, which then triggers further
action and more reaction. COMMOD [6] defined a game as (a) a free activity, (b)
having imaginative components, (c) bounded by space and time, (d) a trigger
group discussion, and (e) a mimic normal behavior. Behind a game is a body of
knowledge called “game theory," which spells out how rational
individuals make a decision when they are interdependent. In game theory,
individualism, rationality, and interdependency are some of the basic
theoretical constructs that predicate the behavior and dispositions of the
players [7].Role-playing
game is specifically designed for the interaction between players based on the
roles they play [8, 9]. Through the RPG, one
can observe the way roles are played, how actions and decisions of players
impact other players’ behavior and decisions, and the impacts to the decision
environment. During the game, each player is allowed to act collectively, to
contribute in creating new institutions or rules among the players, or to achieve
common goals. When the game is over, each player can analyze the lessons learnt
and compare the game to the real world. The game’s realism may take one of
several forms (a) explicit reality, where RPG presents the actors’ real situation and their resources;
(b) implicit reality, where RPG represents a simplified version of
actors and their resources; (c) virtual world, where RPG is based on an
issue which is not necessary related to a specific actor or resource [6].Ostrom et al. [9] distinguished between
cooperative and noncooperative games. In cooperative games, players can
communicate freely and make enforceable agreement; in noncooperative games,
they can do neither. Communication and information sharing among players may
produce collaboration. Cárdenas and Ostrom [10] proposed three layers of
information in deciding about their level of cooperation in three rural
villages of Colombia. The layers range from material incentives to the composition of the group and
the individual characteristics of the player.Recognizing
the importance of collective action in natural resource management in
developing countries, Meinzen-Dick et
al. [11] provided an overview of studies that present applications of
qualitative, quantitative, experimental, and action research methods including
experimental games for studying collective action. Pacheco et al. [12] promoted the capability
of a game to develop a strategy to help organizations deal with various
challenges, and also as a strategy to increase global awareness about
environmental issues and to build environmental responsibility. The game is an
innovative tool that can be used to develop a coordinated strategy among
different actors. Such strategy may also
lead to the development of new institutions and revitalize existing ones. For
instance, Atran et al. [13] described how actors with different mental models of conceptualizing nature
affect their behaviors, strategy, and actions. These mental models have
implications for environmental decision-making and management, including
forestry common property problems.The failure
of forest owners and managers to prohibit user groups from exploitative
extraction of forest resources has forced them to opt for a collaborative
management approach, termed as joint management [14] or
out-grower scheme in forest plantations [15]. Platteau and Gaspart [16], however, have indicated
that the main difficulties of community-driven development lie in their
vulnerability to situations where local elites capture much of the benefits. It
has also been noted that too quick and massive rush to community-driven
development may prove self-defeating in the sense that benefits actually
reaching the poor may be lower than expected if donor agencies are impatient
and do not allow time for institutions to develop [16].
Local democracy often shapes social and environmental sustainability.
Representation in decision making, a trademark of democracy, is the mechanism that can
lead to efficiency, equity, and the elusive sustainability goal promised by
decentralized and community-oriented forms of natural resource management. One
prerequisite condition of this representation in decision-making is local
peoples’ capacity to participate and capability to engage the local elite [17].Enhancing
the capacity of local communities requires the establishment of enabling
institutions which have to be perceived as credible by social actors. In other
words, institutional functionality relies on its social acceptability or
credibility [18]. Focusing on institutions is also advocated by Agrawal
and Gibson [19], who suggested that concentrating on institutions
rather than the community is likely to be more fruitful and effective in
advancing community-based natural resource management.


### 1.3. Context of Pilot Study

Musi Hutan
Persada (MHP) is anAcacia mangium plantation company located in South
Sumatra, Indonesia. MHP is a joint venture composed of the state-owned company
Inhutani II and the private companies Barito Pacific Timber, Muktilestari
Kencana, and Marubeni Corporation. MHP operates under the Indonesian Minister
of Forestry Decree No. 38/Kpts-II/1996, dated 29 January 1996. The MHP
plantations cover a total of 296 400 hectares
across three noncontiguous sites in South Sumatra (see Figure 1).Figure 1
MHP's forest plantation concession in South Sumatra Province (inset Indonesia).Communities
surrounding MHP are mostly made up of traditional farmers. Other members of the
local communities are MHP workers, traders, and local government officials. The
farmers grow rubber, rice, andAcacia mangium in collaboration with MHP.
The local people customarily organized themselves according to the traditional “Marga"
system. Based on customs and traditions, the “Marga" system generated
communal rules and norms for utilizing resources in a specific territory. This system broke down in the early 1980s;
consequently, collective livelihood actions are now rare.In 1998, Indonesia  faced
an economic, social, and political crisis due to the political transition that ensued
following the change in political power at the national level. The crisis
affected all development sectors, including MHP forest plantations which were
established two years earlier. Villages surrounding the plantations began to
ask MHP for more benefits, or for their share from the company’s economic
profits derived from extracting timber from the forest. This led to conflict
between the company and local people. To ease tensions, MHP developed two
cooperative schemes: “Managing Forest with Community"
(MHBM orMengelola Hutan Bersama Masyarakat) and “People Forest
Management" (MHR or Mengelola Hutan Rakyat).The MHBM
area is about 40 000 hectares
and involves 12 villages. In this scheme, the timber company pays the
communities some royalty fees from the MHP plantations on its concession land.
The fee amounts to Rp. 2 500 (US$1  =  Indonesianrupiahs 11 000 (Rp. or IDR)) per cubic meter of log.
Although MHBM is called a partnership scheme, it was found that the scheme
involves MHP giving direct aid to the communities.MHR is
closer to the partnership spirit, with an out-grower scheme for smallholder
plantations. The MHR area is about 4000 hectares and involves eight
villages. Individuals or groups can propose to MHP to plant trees on their own
land, regardless of its status. If MHP approves, the company will provide all
establishment and maintenance costs for small plantations from 2 to 100 hectares. Profits are shared 60% to MHP, and 40% to the individual or group.


## 1.1. Forest Plantations, Pulp Industries, and Land Disputes

Indonesia’s pulp and
paper industry has rapidly expanded since the late 1980s. The 1998 economic
crisis temporarily slowed the rate of expansion, but by 2000 several pulp mills
were established. Disputes over land between local and customary communities
and forest companies during the Soeharto era (i.e., New Order regime, 1966–1998) were
suppressed by military force. Soeharto’s resignation, and the subsequent
political transition in May 1998, spawned the beginning of community movements
demanding that customary rights be restored, including communal land rights.
Conflicts arose as local communities and companies clashed over (1) the land
appropriation process, (2) environmental impacts, and (3) recruitment of
employees [1].


## 1.2. Multiagent Simulation and Role-Playing Game

For better
management planning purposes, forestry planners and policy makers should be
able to assess the long-term impacts of major activities or policies such as
establishing plantations, or cooperation among stakeholders. Simulation is one
way to explore long-term impacts; in fact, it may be the only viable tool for
making impact assessments particularly if the forest system is large or too
complex. Simulation generally involves the process of developing a simplified
representation of a real-world situation (called the simulation model), and “animating"
it so that stakeholders can envision future scenarios.Multiagent
simulation (MAS) is a promising tool for
examining natural resource management alternatives, and for analyzing
environmental management issues [2]. MAS has desirable features that make it an appropriate “analytical
platform" for the participatory natural resource management. It is
flexible and can accommodate many stakeholders, and it is robust enough to
embrace different management options and types of decision-making procedures
and processes.In general,
cooperation among stakeholders can occur naturally only when individuals cannot
pursue their goals on their own. Agents
or actors may communicate among themselves when they are interested to seek
cooperation in order to achieve a shared goal [3, 4], even
when economic, social, or political objectives may differ. Cooperation is a
dynamic concept that evolves over time, but may or may not survive broader
economic and social trends and changes. Hence, Axelrod and Cohen [5] have
examined the need for adaptive capacities among all stakeholders involved in
the cooperative process.Information
and communication technology has made the world an increasingly complex, yet
smaller, place. Forest stakeholders now have
better access to information. They also view themselves and others to have to
deal with more variables, issues, and concerns in order to manage their forests
more effectively. With more and better information, forest stakeholders are now
in a position to examine and possibly improve cooperative arrangements and
institutions. While cooperation should be adaptive, it also needs a certain
amount of resilience to be effective in a dynamic world. Role-playing games
(RPGs) are a useful approach to scrutinize partnership and cooperative
arrangements and examine the capacity for adaptation.In general
terms, a game is an action that triggers a reaction, which then triggers further
action and more reaction. COMMOD [6] defined a game as (a) a free activity, (b)
having imaginative components, (c) bounded by space and time, (d) a trigger
group discussion, and (e) a mimic normal behavior. Behind a game is a body of
knowledge called “game theory," which spells out how rational
individuals make a decision when they are interdependent. In game theory,
individualism, rationality, and interdependency are some of the basic
theoretical constructs that predicate the behavior and dispositions of the
players [7].Role-playing
game is specifically designed for the interaction between players based on the
roles they play [8, 9]. Through the RPG, one
can observe the way roles are played, how actions and decisions of players
impact other players’ behavior and decisions, and the impacts to the decision
environment. During the game, each player is allowed to act collectively, to
contribute in creating new institutions or rules among the players, or to achieve
common goals. When the game is over, each player can analyze the lessons learnt
and compare the game to the real world. The game’s realism may take one of
several forms (a) explicit reality, where RPG presents the actors’ real situation and their resources;
(b) implicit reality, where RPG represents a simplified version of
actors and their resources; (c) virtual world, where RPG is based on an
issue which is not necessary related to a specific actor or resource [6].Ostrom et al. [9] distinguished between
cooperative and noncooperative games. In cooperative games, players can
communicate freely and make enforceable agreement; in noncooperative games,
they can do neither. Communication and information sharing among players may
produce collaboration. Cárdenas and Ostrom [10] proposed three layers of
information in deciding about their level of cooperation in three rural
villages of Colombia. The layers range from material incentives to the composition of the group and
the individual characteristics of the player.Recognizing
the importance of collective action in natural resource management in
developing countries, Meinzen-Dick et
al. [11] provided an overview of studies that present applications of
qualitative, quantitative, experimental, and action research methods including
experimental games for studying collective action. Pacheco et al. [12] promoted the capability
of a game to develop a strategy to help organizations deal with various
challenges, and also as a strategy to increase global awareness about
environmental issues and to build environmental responsibility. The game is an
innovative tool that can be used to develop a coordinated strategy among
different actors. Such strategy may also
lead to the development of new institutions and revitalize existing ones. For
instance, Atran et al. [13] described how actors with different mental models of conceptualizing nature
affect their behaviors, strategy, and actions. These mental models have
implications for environmental decision-making and management, including
forestry common property problems.The failure
of forest owners and managers to prohibit user groups from exploitative
extraction of forest resources has forced them to opt for a collaborative
management approach, termed as joint management [14] or
out-grower scheme in forest plantations [15]. Platteau and Gaspart [16], however, have indicated
that the main difficulties of community-driven development lie in their
vulnerability to situations where local elites capture much of the benefits. It
has also been noted that too quick and massive rush to community-driven
development may prove self-defeating in the sense that benefits actually
reaching the poor may be lower than expected if donor agencies are impatient
and do not allow time for institutions to develop [16].
Local democracy often shapes social and environmental sustainability.
Representation in decision making, a trademark of democracy, is the mechanism that can
lead to efficiency, equity, and the elusive sustainability goal promised by
decentralized and community-oriented forms of natural resource management. One
prerequisite condition of this representation in decision-making is local
peoples’ capacity to participate and capability to engage the local elite [17].Enhancing
the capacity of local communities requires the establishment of enabling
institutions which have to be perceived as credible by social actors. In other
words, institutional functionality relies on its social acceptability or
credibility [18]. Focusing on institutions is also advocated by Agrawal
and Gibson [19], who suggested that concentrating on institutions
rather than the community is likely to be more fruitful and effective in
advancing community-based natural resource management.


## 1.3. Context of Pilot Study

Musi Hutan
Persada (MHP) is anAcacia mangium plantation company located in South
Sumatra, Indonesia. MHP is a joint venture composed of the state-owned company
Inhutani II and the private companies Barito Pacific Timber, Muktilestari
Kencana, and Marubeni Corporation. MHP operates under the Indonesian Minister
of Forestry Decree No. 38/Kpts-II/1996, dated 29 January 1996. The MHP
plantations cover a total of 296 400 hectares
across three noncontiguous sites in South Sumatra (see Figure 1).Figure 1
MHP's forest plantation concession in South Sumatra Province (inset Indonesia).Communities
surrounding MHP are mostly made up of traditional farmers. Other members of the
local communities are MHP workers, traders, and local government officials. The
farmers grow rubber, rice, andAcacia mangium in collaboration with MHP.
The local people customarily organized themselves according to the traditional “Marga"
system. Based on customs and traditions, the “Marga" system generated
communal rules and norms for utilizing resources in a specific territory. This system broke down in the early 1980s;
consequently, collective livelihood actions are now rare.In 1998, Indonesia  faced
an economic, social, and political crisis due to the political transition that ensued
following the change in political power at the national level. The crisis
affected all development sectors, including MHP forest plantations which were
established two years earlier. Villages surrounding the plantations began to
ask MHP for more benefits, or for their share from the company’s economic
profits derived from extracting timber from the forest. This led to conflict
between the company and local people. To ease tensions, MHP developed two
cooperative schemes: “Managing Forest with Community"
(MHBM orMengelola Hutan Bersama Masyarakat) and “People Forest
Management" (MHR or Mengelola Hutan Rakyat).The MHBM
area is about 40 000 hectares
and involves 12 villages. In this scheme, the timber company pays the
communities some royalty fees from the MHP plantations on its concession land.
The fee amounts to Rp. 2 500 (US$1  =  Indonesianrupiahs 11 000 (Rp. or IDR)) per cubic meter of log.
Although MHBM is called a partnership scheme, it was found that the scheme
involves MHP giving direct aid to the communities.MHR is
closer to the partnership spirit, with an out-grower scheme for smallholder
plantations. The MHR area is about 4000 hectares and involves eight
villages. Individuals or groups can propose to MHP to plant trees on their own
land, regardless of its status. If MHP approves, the company will provide all
establishment and maintenance costs for small plantations from 2 to 100 hectares. Profits are shared 60% to MHP, and 40% to the individual or group.


## 2. Development
of the Game

In the case
study, villagers living around the MHP plantations may or may not participate
in a partnership in seven different ways (a) small-scaleAcacia mangium cultivation (out-grower scheme), (b) planting rubber,
(c) maintaining old rubber, (d) growing oil palm, (e) providing labor for
MHP, (f) growing small-scale mixed-plantation, and (g) looking for rent
opportunities. By comparison, the company manages its big Acacia plantation, participates in the partnership, and manages its
employees.The game’s
goal is to improve local welfare by giving communities an insight into how to
construct their livelihood strategies. The objectives are (a) to share
knowledge with local communities about livelihood strategies and (b) to help
collective decision making on self-organization, cooperation, and coordination
to achieve the common goal.The general
modeling process and the pilot study followed the following steps: (a) represent the MHBM and MHR in the game; (b)
test and engage the stakeholders in refining the model; (c) conduct
role-playing game; (d) develop future scenarios; (e) develop rational
collective plans and actions. This paper describes the experiment conducted
under the first four steps. To facilitate the modeling process, a “companion
modeling approach" with a modeling tool, namely, Common Pool Resources and
Multi-Agent System (CORMAS) was adopted. CORMAS is a multiagent simulation
platform specifically designed for renewable resource management systems [20, 21].Prior to
developing the game, the authors visited the sites and had several discussions
with stakeholders to get a first-hand understanding of the context. This game
is to be played at the community level; in other words, the community’s
perspective is at the core of the game. The stakeholders were identified
according to the following criteria: proximity to the forest, legal or
traditional rights over the forest, and dependence on the forest.The game
usedimplicit reality, meaning it is
based on a simplified representation of actors, resources, and land management
relevant to the players, in this case MHP. This approach offers more advantages
than explicit reality in terms of (a)
avoiding issues sensitive to some community members, such as the boundary
between community and MHP land and (b) providing higher flexibility in the
game.Two types
of stakeholders were identified, namely, the local communities, and the MHP with its land
concession planted withAcacia mangium. In formulating the “rules"
of the game, the focus was more on the roles of the communities in the
partnership rather than MHP. Some of the community members have traditional
lands so that they can enter into MHR partnership, or grow trees such as rubber
and oil palm. Community members without land can work as laborers of MHP, rubber
tappers, or do off-farm jobs.


### 2.1. Spatial Setting of the Playing Field

Figure2
describes the spatial setting of the game. The spatial context of the game is a
landscape that comprises 25 cells. Each cell represents 10 hectares. There are
two land categories, namely, company Acacia plantation and the community’s small, old, and unproductive rubber
plantations.Figure 2
Game spatial setting with community land (bottom) and MHP forest concession (top).


### 2.2. Players and Their Decision Spaces

There are
two categories of community players: villagers with, and villagers without
land. They are all located within the
communities. The game is played with six people as landowners (LOs) and four as
nonland owners (NLOs). The proportional numbers of LOs and NLOs were intended to balance
power and reflect real situation in the field.LOs may
manage their land, participate in MHBM, and work for the company, or become
company laborers. These three options are not mutually exclusive. It means that
they may choose more than one option at the same time. The first option,
managing the land, comprises three suboptions:
keeping the old rubber trees, selling the land, or replanting it withAcacia mangium, oil palm, a new rubber
variety, or mixed plantation.NLOs do not
have many options. NLOs may participate in MHBM or provide company labor. Both
LOs and NLOs may also become free riders or rent seekers in this game. Table1 shows a simplified payoff for
managing the land for over 20 years. The simple payoff table describes the
investment (I) and economic return (R) at the strategic level represented by
the strategic choices available to the villagers with and without land. Hence,
the payoff table shows the amount invested when the strategic option is chosen,
and the expected return from the strategic option at a given time in the future
(e.g., rotation). In the case of the MHBM partnership scheme, there is no
investment required from the local community to get a return of rupiahs 5 million
(i.e., royalty) at the end of an Acacia eight-year rotation. MHR partnership
scheme requires land and investment of Rp 2 million at the beginning of the
year in order to gain a return of Rp 80 million at the end of the
rotation. Preserving old and
unproductive rubber plantation costs nothing but it will produce insignificant income.
Investing in new varieties of rubber and oil palm involves significant costs
estimated at about rupiahs 60 million which is generally
unaffordable for individual farmers although such investment can yield
significant economic returns. Mix plantation takes longer rotations than an
acacia plantation, but it can yield higher values particularly with respect to
biodiversity.Table 1
Investment
(I) and return (R) in millions rupiahs.
YearMHBM partnershipMHR partnershipPreserving oldGrowing new clonesGrowing oilGrowing mixschemeschemerubberof rubberpalmplantationIRIRIRIRIRIR100200060090020020000000000203000000000020400000000002050000000000206000000060090207000000060090208050800006009020900200006009020100000000600902011000000060090201200000004807220130000000480722014000000048072201500000004807220160508000048072201700200004807220180000000360542019000000036054202000000003605420600In this experiment, the game
is intended to represent the local community’s strategies in improving their
livelihoods under options and rules created by MHP such as MHR and MHBM partnership
arrangements. It also provides a way to analyze how communication and
collaboration can improve the local community’s livelihood strategies. It
focuses on the dynamic relationships among local communities rather than with
MHP. Hence, the company at this RPG stage is perceived as “typical"
or in a “ceteris paribus” sense.The company
can play roles such as: reformulating the benefit-sharing arrangement of MHBM
and MHR, considering planting options other than Acacia, or changing the acceptance
number of MHR applicants. In the current game, MHP only accepts four players
with MHR proposal applications, which represents, and is commensurate with, the
limit of MHP’s funding for joint venture with local communities. MHP can
increase this limitation by accepting more MHR proposals. In such cases, the local community, as
rational players, can react by implementing a different strategy as they
attempt to maximize their benefit in light of the company's changing policy.


### 2.3. Playing the Game

The diagram
of the game context is shown in Figure3. The figure represents a forest
plantation partnership within a bounded system with the categories of actors
involved: communities, and the company, in this case the MHP. The different
options for local communities and the company are also described.Figure 3
Use case diagram of the game.Initially,
each player has 10 million rupiahs as their first liquid resource. As soon as
the game starts, the LO has a cell to decide. NLO has to decide whether to
participate in MHBM. Then, LO has to choose a land management option. As
described in Table1, each option has consequences in terms of investment and
return.The game is
designed to be played following the sequence A, B, and C. The general challenge
and objective of the players are
to maximize the total returns, specifically cumulative revenue, in twenty
time-steps, representing 20 years. Scenario A is designed to explore the
situation where there is no communication among the players. In scenario B,
players are divided into two groups (NLOs and LOs), and each group is organized
into communication and collaboration subgroups. Finally, in scenario C, all
players are in the same group; hence, they are able to communicate and possibly
collaborate, if the players believe it will serve their own individual and
collective interests.The
company can only afford four players to participate in the MHR scheme during
the game. If there are more than four players who apply for the MHR scheme, the
company will randomly choose and approve four.Landscape
diversity, an important indicator that should be monitored, can be calculated
using average cell diversity following a simple algorithm as follows: (a) if a cell is a mix
plantation, then the cell diversity is equal to 100%; (b) if it is not a mix
plantation, then the cell diversity is calculated by dividing the number of
cell neighbors that have different land uses with the number of total
neighbors; hence, cell diversity is between 0 and 100%. Cell
diversity affects fire risk in the area; hence, it should be monitored. If a cell
has low cell diversity and it is planted withAcacia, then the
probability of fire is high. Fire can spread out through the Acacia plantation cells via connected edges.During and
after the game, the game facilitator took note and presented the expected
revenues to the players, the land diversity, and the emerging institutions in
A, B, and C scenarios. The facilitator and the players can then react, share
their views, and discuss the overall situation, including the need for
institutions which may emerge during the game.


## 2.1. Spatial Setting of the Playing Field

Figure2
describes the spatial setting of the game. The spatial context of the game is a
landscape that comprises 25 cells. Each cell represents 10 hectares. There are
two land categories, namely, company Acacia plantation and the community’s small, old, and unproductive rubber
plantations.Figure 2
Game spatial setting with community land (bottom) and MHP forest concession (top).


## 2.2. Players and Their Decision Spaces

There are
two categories of community players: villagers with, and villagers without
land. They are all located within the
communities. The game is played with six people as landowners (LOs) and four as
nonland owners (NLOs). The proportional numbers of LOs and NLOs were intended to balance
power and reflect real situation in the field.LOs may
manage their land, participate in MHBM, and work for the company, or become
company laborers. These three options are not mutually exclusive. It means that
they may choose more than one option at the same time. The first option,
managing the land, comprises three suboptions:
keeping the old rubber trees, selling the land, or replanting it withAcacia mangium, oil palm, a new rubber
variety, or mixed plantation.NLOs do not
have many options. NLOs may participate in MHBM or provide company labor. Both
LOs and NLOs may also become free riders or rent seekers in this game. Table1 shows a simplified payoff for
managing the land for over 20 years. The simple payoff table describes the
investment (I) and economic return (R) at the strategic level represented by
the strategic choices available to the villagers with and without land. Hence,
the payoff table shows the amount invested when the strategic option is chosen,
and the expected return from the strategic option at a given time in the future
(e.g., rotation). In the case of the MHBM partnership scheme, there is no
investment required from the local community to get a return of rupiahs 5 million
(i.e., royalty) at the end of an Acacia eight-year rotation. MHR partnership
scheme requires land and investment of Rp 2 million at the beginning of the
year in order to gain a return of Rp 80 million at the end of the
rotation. Preserving old and
unproductive rubber plantation costs nothing but it will produce insignificant income.
Investing in new varieties of rubber and oil palm involves significant costs
estimated at about rupiahs 60 million which is generally
unaffordable for individual farmers although such investment can yield
significant economic returns. Mix plantation takes longer rotations than an
acacia plantation, but it can yield higher values particularly with respect to
biodiversity.Table 1
Investment
(I) and return (R) in millions rupiahs.
YearMHBM partnershipMHR partnershipPreserving oldGrowing new clonesGrowing oilGrowing mixschemeschemerubberof rubberpalmplantationIRIRIRIRIRIR100200060090020020000000000203000000000020400000000002050000000000206000000060090207000000060090208050800006009020900200006009020100000000600902011000000060090201200000004807220130000000480722014000000048072201500000004807220160508000048072201700200004807220180000000360542019000000036054202000000003605420600In this experiment, the game
is intended to represent the local community’s strategies in improving their
livelihoods under options and rules created by MHP such as MHR and MHBM partnership
arrangements. It also provides a way to analyze how communication and
collaboration can improve the local community’s livelihood strategies. It
focuses on the dynamic relationships among local communities rather than with
MHP. Hence, the company at this RPG stage is perceived as “typical"
or in a “ceteris paribus” sense.The company
can play roles such as: reformulating the benefit-sharing arrangement of MHBM
and MHR, considering planting options other than Acacia, or changing the acceptance
number of MHR applicants. In the current game, MHP only accepts four players
with MHR proposal applications, which represents, and is commensurate with, the
limit of MHP’s funding for joint venture with local communities. MHP can
increase this limitation by accepting more MHR proposals. In such cases, the local community, as
rational players, can react by implementing a different strategy as they
attempt to maximize their benefit in light of the company's changing policy.


## 2.3. Playing the Game

The diagram
of the game context is shown in Figure3. The figure represents a forest
plantation partnership within a bounded system with the categories of actors
involved: communities, and the company, in this case the MHP. The different
options for local communities and the company are also described.Figure 3
Use case diagram of the game.Initially,
each player has 10 million rupiahs as their first liquid resource. As soon as
the game starts, the LO has a cell to decide. NLO has to decide whether to
participate in MHBM. Then, LO has to choose a land management option. As
described in Table1, each option has consequences in terms of investment and
return.The game is
designed to be played following the sequence A, B, and C. The general challenge
and objective of the players are
to maximize the total returns, specifically cumulative revenue, in twenty
time-steps, representing 20 years. Scenario A is designed to explore the
situation where there is no communication among the players. In scenario B,
players are divided into two groups (NLOs and LOs), and each group is organized
into communication and collaboration subgroups. Finally, in scenario C, all
players are in the same group; hence, they are able to communicate and possibly
collaborate, if the players believe it will serve their own individual and
collective interests.The
company can only afford four players to participate in the MHR scheme during
the game. If there are more than four players who apply for the MHR scheme, the
company will randomly choose and approve four.Landscape
diversity, an important indicator that should be monitored, can be calculated
using average cell diversity following a simple algorithm as follows: (a) if a cell is a mix
plantation, then the cell diversity is equal to 100%; (b) if it is not a mix
plantation, then the cell diversity is calculated by dividing the number of
cell neighbors that have different land uses with the number of total
neighbors; hence, cell diversity is between 0 and 100%. Cell
diversity affects fire risk in the area; hence, it should be monitored. If a cell
has low cell diversity and it is planted withAcacia, then the
probability of fire is high. Fire can spread out through the Acacia plantation cells via connected edges.During and
after the game, the game facilitator took note and presented the expected
revenues to the players, the land diversity, and the emerging institutions in
A, B, and C scenarios. The facilitator and the players can then react, share
their views, and discuss the overall situation, including the need for
institutions which may emerge during the game.


## 3. Results and Discussion

The game was pilot tested using
university students at Bogor Agricultural University,
Bogor, Indonesia. The
experimental game was pilot tested with university students. The students were
chosen in part because they are able to freely and genuinely express their
ideas about the community's future livelihood options without being connected
to these options. They are also able to quickly detect what livelihood options
can improve the community's local economy. This situation supports the
underlying assumption of the game (i.e., economic rationality). Using students
in the experimental game has resulted in the improvement of the game due to the
students’ critical thinking skills.
Students can be easily transformed into good game players in a virtual
world such as in participatory simulation equipped with rules, experimentation,
and scenario development in Colella [22].Nevertheless,
the students can be biased in their thinking about livelihoods vis-à-vis conservation.
They may tend to be more idealistic than villagers in terms of putting
conservation as more important than livelihoods. On the other hand, villagers
are usually more deeply connected to their current works and life situations,
and they tend to be less concerned about long-term consequences of different
options without intensive facilitation. Intensive facilitation is necessary to
ensure that they understand all possible options.The
experiment aimed at
observing how the RPG approach, and the CORMAS-based model developed performance under the
conditions of “implicit realism" described in Section1.3. Hence, the
RPG-CORMAS model was developed to reflect, as “close" as possible,
the “rules," attitudes, behaviors, perspectives, and views of the local
communities as observed and noted by the researchers during field visits to the
site. Before doing the RPG study, the participants were briefed about RPG, what
the experimental pilot study is about, the issues to be examined, and their “roles"
in the RPG. The participants were not
instructed, or guided in any way, about how the game was to be played by them.
It was explained to them, however, that the objective of the experiment was to
empirically examine “community-company partnerships," particularly
different partnership arrangements and their relationships in the context of
managing the resource. The participants were also asked to be available and
participate throughout the stages, iterations, and applications of the RPG
process.To simplify
the analysis, the players considered revenues from land management as the sole
income source. The cost of money, such as commercial (bank) and noncommercial
rates, was also not included in the analysis.


### 3.1. Scenario A: No Communication among the Game Players

The LO
players do not have enough capital individually to invest in their land
separately. As a result, six players tried to growAcacia under the MHR
scheme, but only four were accepted by MHP (Figure 4—cells 19, 20, 22,
and 24). The four NLO players located on the concession land followed the MHBM
scheme (cells 4, 6, 7, and 11). The total cumulative revenue for 20 years
amounts to rupiahs 756 million
for 10 players (see Table 2). As an
initial approach, the total net revenue was chosen as a marker to compare the
scenarios.Table 2
The players’ cumulative
revenue under scenario A (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001400052809224000520092340005200924400052009254000520092640005200927400052009284002052032043296000364804241060003640042411600036400424126000364004241360003640042414600036400424156000364004241660020364832076417800067600756188000676007561980006760075620800067600756Figure 4
Scenario A: four players participate in MHBM scheme and the other four players participate in MHR scheme.As shown in
Table2, the cumulative revenue of 40 million rupiahs for the
four NLO players is calculated from their 10 million rupiahs initial
capital. At year 8, Acacia reaches its rotation age and is harvested.
Hence, each NLO player received a return (i.e., royalty) of 5 million rupiahs. Therefore, beginning year 9, the
cumulative income of the four NLO players is 60 million. The 6 LO players, on
the other hand, had 60 million initial capital. Four invested on the MHR scheme
costing 8 million, and hence the cumulative revenue in year 1 is 52 million. At
year 8, the Acacia planted is harvested; hence, the 4 LO players received a
return of 320 million rupiahs.Without
communication, there was no opportunity for the players to pool their capital.
Given the amount of capital each player has, joining MHR scheme was the
rational choice for the LO players. Two LO players wanted but were not accepted
to the MHR scheme because only four MHR applications are allowed by the
company. NLO players kept their capital since they have no land to invest under
the MHR scheme. Working individually, in fact, reflects the current situation
in the communities surrounding the plantations. Lack of effective communication
and trust made them act individually in dealing with their own livelihoods.


### 3.2. Scenario B: Communication and Collaboration within Each Group of Players

In scenario
B, the LO and NLO players could communicate and collaborate within their
groups. After some discussions,
the two groups came up with two strategies. The NLO players representing the
communities without land stayed with the MHBM scheme (Figure5—cells 2, 5, 7,
and 16). Hence, there was no change in their cumulative revenues as shown in
Table 3. The LO players representing communities with land agreed to invest all
their money in rubber plantations (see Figure 5, cell 23). Establishing rubber
plantations required an investment of rupiahs 60 million. The six LO players were able to put up
the investment by pooling their capital. After 20 years, their cumulative
return, which amounted to rupiahs 836 million, was better compared
to scenario A (i.e., if they had invested in MHR—see Table 3).Table 3
Scenario B: the players’ cumulative revenue
under scenario B (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001400006004024000000403400000040440000004054000000406400000601007400060060160840020120060240960001800603001060002400603601160003000604201260003600484681360004080485161460004560485641560005040486121660020552048680178000600048728188000648036764198000684036800208000720036836Figure 5
Scenario B: six players with land pool their money to invest in rubber plantations.Communication
within each group increases the livelihood choices. Instead of acting
individually, the LO players pooled their capital and established a new rubber
plantation. Individually, each player
does not have sufficient money to invest in his/her rubber plantation. This
situation helps explain why most community rubber plantations now are old and
unproductive.  Collective action in the
form of collective investment provides more choices to local communities.


### 3.3. Scenario C: Communication and Collaboration among All Players

In this
scenario, all 10 players could communicate and collaborate. Hence, the players
can evaluate each strategy with respect to their own individual interests, as
well as their share in the “collective benefits," if they cooperate.
They discussed different individual and collective strategies. The results are shown in Figure6.
Eventually, they selected a strategy, and came up with a plan to invest in oil
palm (cell 19) which needed rupiahs 90 million as initial investments. Nine players
pooled their resources to meet the initial investment cost. After 20 years, the
cumulative return was about rupiahs 1184 million (see Table 4).Table 4
The players’ cumulative
revenue under scenario C (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001100009001021000000103100000010410000001051000000106100000901007100090090190810020180090300930002700903901030003600904801130004500905701230005400726421330006120727141430006840727861530007560728581630020828072950175000900072102218500097205410761950001026054113020500010800541184Figure 6
Scenario C: nine players pool their money to invest in oil palm plantation.The game
was iterated twice. In the case of scenarios A and B, the players came up with
the same strategy in the second iteration. This is not the case with scenario C
where the players came up with a different strategy in the second iteration.
Instead of investing all their money in oil palm, they decided to have two
kinds of investments: MHR (cells 20, 22, and 23) and rubber plantation (see cell
9—Figure7). As a
result, after 20 years, their net revenue was higher than in previous scenarios
(see Table 5).Table 5
The players’ cumulative
revenue under scenario C1 (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn04000600010013400066034234000003433400000344340000034534000003463400006094734006006015483402012003004749540041466052810540047406058811540053406064812540059404869613540064204874414540069004879215540073804884016540207860288114817740010686481190187400111603612261974001152036126220740011880361298Figure 7
Scenario C1: six players invest in rubber plantation (cell 9), and the other three players invest in MHR (cells 20, 22, and 23).Figure8
describes a comparative diagram of the cumulative revenues associated with each
scenario. The net present values (NPVs) of these scenarios, at 8% and 12%
interest rates, are summarized in Table 6. The table shows that scenario C1 is
the most profitable option with the highest NPV. Scenario C also gave
consistently higher NPVs compared to scenarios A and B. Scenario A has a higher NPV than scenario B
at 12% mainly because of its high revenue values early in the rotation.
Scenario B has a higher NPV value than scenario A at lower interest rates (e.g.,
8%).Table 6
Saving
and returns for each scenario (million rupiahs).
Time (t)Scenario AScenario BScenario CScenario C1CumulativeSaving and return at timetCumulativeSaving and return at timetCumulativeSaving and return at timetCumulativeSaving and return at timet010010010010010010010010019292404010103434292040010034039204001003404920400100340592040010034069201006010090946079201606019090154608432340240803001104743209424−8300603909052854104240360604809058860114240420605709064860124240468486427269648134240516487147274448144240564487867279248154240612488587284048167643406806895092114830817756−872848102272119042187560764361076541226361975608003611305412623620756083636118454129836NPV5836971,0281,108Figure 8
The total net revenue collected by 10 players during 20 years (in million rupiahs) for Scenario A, B, C and C1.The
relative land diversities for scenarios A, B, C, and C1 were 40.8, 27.9, 27.6,
and 34.9, respectively. It was assumed that the land outside MHP forest was
homogeneous, and that even though planted withAcacia (scenario A),
diversity would increase. However, the probability of fires during the period
of community investment is lower in scenarios B and C because both scenarios
did not involve Acacia plantations. Scenario C1, which is more
profitable than scenario C, also has higher landscape diversity than scenario
C.The game
shows that communication and collaboration among the players can produce more
options to improve the communities’ livelihood by their resources. Through this
collaboration, collective investment can emerge. It is easy to see that rubber
plantations are more profitable than the MHR scheme; however, people in South
Sumatra currently cannot renew their rubber smallholdings for the lack of the
required capital amounting to rupiahs 6 million per hectare. If they can
anticipate the net return of collective investment, then they may realize that
there is a chance for future renewal.If this
collective action is extended to community members without land who are
currently working for the MHBM scheme, their net return will even be higher. In
the first game iteration, they collaboratively planted oil palm, but in the
second they concurrently planted rubber and participated in the MHR scheme.
From the simple case study, one can see evidence of the learning process
through playing the game. It is hard to determine whether an optimum solution
will emerge automatically if they cooperate, but it is possible that the
optimum solution will be discovered over time. Regardless optimality of chosen
strategy is not as important as social acceptability of chosen strategy. In a
case as complex as the problem addressed in this case study, “pareto
optimality" may only exist theoretically, but may be too elusive, if not
impossible, to determine.


### 3.4. Institutional Implications

Communication
had been shown to be an effective mechanism for increasing the likelihood that
stakeholders choose benefit-sharing strategies. For instance, in this study, communication
facilitated through RPG enabled the players to explore various strategies that
increased their cumulative incomes. These collective strategies emerged, in
part, from the participants’ realization that they might get better returns
given the payoff structure and if they collaborate and develop a group
strategy.The
experiment demonstrated the importance of communication and its potential in
increasing community benefits. This is particularly true when communication is
provided as a mechanism for the players to envisage a coordinated strategy. For
instance, in this experimental pilot study, an ex-postapplication of RPG at
the community led to the formation of communication institutions such as a
community forum at the village level and a multistakeholder forum at the
district level. However, community institutions are not costless and are not
formed easily and quickly. The community and other stakeholders need to invest
time and effort to establish these forums or arenas. This is particularly significant
because the communities surrounding the MHP plantations, used as the
experimental case study, are
subsistence community where most people live poorly with less than 1 USD per
day [23]. Hence, the MHP plantations influence the
traditional livelihoods of the community. Therefore, the level of cooperation
among community members may be strongly influenced by inherent competition
among the communities for the benefits derived from the plantations. This makes
the formation of community forums even more difficult, but strategically
significant.Communication
among community members as well as the effort to arrive at a coordinated
strategy may slow the decision-making process seeking fruitful partnership with
MHP. However, since forest- and land-related activities are long-term
investments, and realizing that impatience may undermine long-term social and
ecological sustainability [17], a slower and more deliberate
decision-making process particularly at the beginning is reasonable.Coordinated
strategy involves producing rules for sharing benefit and cost of any land use
option. In the case study, the establishment of a communication institution,
such as a formal forum, was deemed critical to the enforcement of these rules. Without
this rule enforcement capability, problems related to free riders and rent
seekers can emerge easily. Moreover, the problem of elite capture as described
by Platteau and Gaspart [16] can also diminish. Learning from RPG experiment,
the real stakeholders in Muara Enim District agreed to establish a forum,
called “Forum Sebahu Sejalan.” This forum was equipped with an explicit
constitution and rule, called anggaran
dasar and anggaran rumah tangga,
to guide the organization and execution of the forum.The forum
is envisioned to serve as a mechanism to bridge the community and MHP’s
interests. Through the coordinated strategy, and particularly the formal forum,
the community is positioned in an environment, where they are able to bargain
and negotiate with MHP. On the other hand, MHP also benefits from the forum
through reducing transaction cost of negotiation. Without the formal forum, MHP
traditionally deals with individual community members and leaders. With the
formal forum, a more balanced partnership can emerge from discussions between
community members, united by the common strategy, and MHP. For instance, in an
ex-postapplication of RPG, MHP has agreed to give a more transparent figure
about the overall plantation costs and returns in response to requests made by
the community. MHP also agreed to lend money to the community to enable them to
make better land use investments as well as pursue small plantation operational
contracts with MHP such as weeding and harvesting. This balanced and transparent
partnership can only make the partnership more resilient. The forum provides
both parties with a common ground to negotiate about regular issues such as
profit sharing at the end of rotation, as well as sensitive issues such as land
property ownership and access to resources.In
the case study, the “Forum Sebahu Sejalan” is also a place where the local government
of Muara Enim, South Sumatra communicates and negotiates with community members
and representatives. At the same time, local community can participate and
influence policy formulation on forest plantations such as benefit sharing,
plantation extent, production targets, and location. This forum is envisioned
as a mechanism to make the decentralization policies work better for forest
plantations at the district level. The forum, its constitution, and rules play
a role as institutional mechanisms that can encourage the local community to
cooperate with government officials and to promote more interactions between
less powerful community members and government officials.


## 3.1. Scenario A: No Communication among the Game Players

The LO
players do not have enough capital individually to invest in their land
separately. As a result, six players tried to growAcacia under the MHR
scheme, but only four were accepted by MHP (Figure 4—cells 19, 20, 22,
and 24). The four NLO players located on the concession land followed the MHBM
scheme (cells 4, 6, 7, and 11). The total cumulative revenue for 20 years
amounts to rupiahs 756 million
for 10 players (see Table 2). As an
initial approach, the total net revenue was chosen as a marker to compare the
scenarios.Table 2
The players’ cumulative
revenue under scenario A (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001400052809224000520092340005200924400052009254000520092640005200927400052009284002052032043296000364804241060003640042411600036400424126000364004241360003640042414600036400424156000364004241660020364832076417800067600756188000676007561980006760075620800067600756Figure 4
Scenario A: four players participate in MHBM scheme and the other four players participate in MHR scheme.As shown in
Table2, the cumulative revenue of 40 million rupiahs for the
four NLO players is calculated from their 10 million rupiahs initial
capital. At year 8, Acacia reaches its rotation age and is harvested.
Hence, each NLO player received a return (i.e., royalty) of 5 million rupiahs. Therefore, beginning year 9, the
cumulative income of the four NLO players is 60 million. The 6 LO players, on
the other hand, had 60 million initial capital. Four invested on the MHR scheme
costing 8 million, and hence the cumulative revenue in year 1 is 52 million. At
year 8, the Acacia planted is harvested; hence, the 4 LO players received a
return of 320 million rupiahs.Without
communication, there was no opportunity for the players to pool their capital.
Given the amount of capital each player has, joining MHR scheme was the
rational choice for the LO players. Two LO players wanted but were not accepted
to the MHR scheme because only four MHR applications are allowed by the
company. NLO players kept their capital since they have no land to invest under
the MHR scheme. Working individually, in fact, reflects the current situation
in the communities surrounding the plantations. Lack of effective communication
and trust made them act individually in dealing with their own livelihoods.


## 3.2. Scenario B: Communication and Collaboration within Each Group of Players

In scenario
B, the LO and NLO players could communicate and collaborate within their
groups. After some discussions,
the two groups came up with two strategies. The NLO players representing the
communities without land stayed with the MHBM scheme (Figure5—cells 2, 5, 7,
and 16). Hence, there was no change in their cumulative revenues as shown in
Table 3. The LO players representing communities with land agreed to invest all
their money in rubber plantations (see Figure 5, cell 23). Establishing rubber
plantations required an investment of rupiahs 60 million. The six LO players were able to put up
the investment by pooling their capital. After 20 years, their cumulative
return, which amounted to rupiahs 836 million, was better compared
to scenario A (i.e., if they had invested in MHR—see Table 3).Table 3
Scenario B: the players’ cumulative revenue
under scenario B (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001400006004024000000403400000040440000004054000000406400000601007400060060160840020120060240960001800603001060002400603601160003000604201260003600484681360004080485161460004560485641560005040486121660020552048680178000600048728188000648036764198000684036800208000720036836Figure 5
Scenario B: six players with land pool their money to invest in rubber plantations.Communication
within each group increases the livelihood choices. Instead of acting
individually, the LO players pooled their capital and established a new rubber
plantation. Individually, each player
does not have sufficient money to invest in his/her rubber plantation. This
situation helps explain why most community rubber plantations now are old and
unproductive.  Collective action in the
form of collective investment provides more choices to local communities.


## 3.3. Scenario C: Communication and Collaboration among All Players

In this
scenario, all 10 players could communicate and collaborate. Hence, the players
can evaluate each strategy with respect to their own individual interests, as
well as their share in the “collective benefits," if they cooperate.
They discussed different individual and collective strategies. The results are shown in Figure6.
Eventually, they selected a strategy, and came up with a plan to invest in oil
palm (cell 19) which needed rupiahs 90 million as initial investments. Nine players
pooled their resources to meet the initial investment cost. After 20 years, the
cumulative return was about rupiahs 1184 million (see Table 4).Table 4
The players’ cumulative
revenue under scenario C (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn0400060001001100009001021000000103100000010410000001051000000106100000901007100090090190810020180090300930002700903901030003600904801130004500905701230005400726421330006120727141430006840727861530007560728581630020828072950175000900072102218500097205410761950001026054113020500010800541184Figure 6
Scenario C: nine players pool their money to invest in oil palm plantation.The game
was iterated twice. In the case of scenarios A and B, the players came up with
the same strategy in the second iteration. This is not the case with scenario C
where the players came up with a different strategy in the second iteration.
Instead of investing all their money in oil palm, they decided to have two
kinds of investments: MHR (cells 20, 22, and 23) and rubber plantation (see cell
9—Figure7). As a
result, after 20 years, their net revenue was higher than in previous scenarios
(see Table 5).Table 5
The players’ cumulative
revenue under scenario C1 (million rupiahs).
TimeWithout land (NLO)With land (LO)Total cumulative revenueCumulative revenueInvestReturnCumulative revenueInvestReturn04000600010013400066034234000003433400000344340000034534000003463400006094734006006015483402012003004749540041466052810540047406058811540053406064812540059404869613540064204874414540069004879215540073804884016540207860288114817740010686481190187400111603612261974001152036126220740011880361298Figure 7
Scenario C1: six players invest in rubber plantation (cell 9), and the other three players invest in MHR (cells 20, 22, and 23).Figure8
describes a comparative diagram of the cumulative revenues associated with each
scenario. The net present values (NPVs) of these scenarios, at 8% and 12%
interest rates, are summarized in Table 6. The table shows that scenario C1 is
the most profitable option with the highest NPV. Scenario C also gave
consistently higher NPVs compared to scenarios A and B. Scenario A has a higher NPV than scenario B
at 12% mainly because of its high revenue values early in the rotation.
Scenario B has a higher NPV value than scenario A at lower interest rates (e.g.,
8%).Table 6
Saving
and returns for each scenario (million rupiahs).
Time (t)Scenario AScenario BScenario CScenario C1CumulativeSaving and return at timetCumulativeSaving and return at timetCumulativeSaving and return at timetCumulativeSaving and return at timet010010010010010010010010019292404010103434292040010034039204001003404920400100340592040010034069201006010090946079201606019090154608432340240803001104743209424−8300603909052854104240360604809058860114240420605709064860124240468486427269648134240516487147274448144240564487867279248154240612488587284048167643406806895092114830817756−872848102272119042187560764361076541226361975608003611305412623620756083636118454129836NPV5836971,0281,108Figure 8
The total net revenue collected by 10 players during 20 years (in million rupiahs) for Scenario A, B, C and C1.The
relative land diversities for scenarios A, B, C, and C1 were 40.8, 27.9, 27.6,
and 34.9, respectively. It was assumed that the land outside MHP forest was
homogeneous, and that even though planted withAcacia (scenario A),
diversity would increase. However, the probability of fires during the period
of community investment is lower in scenarios B and C because both scenarios
did not involve Acacia plantations. Scenario C1, which is more
profitable than scenario C, also has higher landscape diversity than scenario
C.The game
shows that communication and collaboration among the players can produce more
options to improve the communities’ livelihood by their resources. Through this
collaboration, collective investment can emerge. It is easy to see that rubber
plantations are more profitable than the MHR scheme; however, people in South
Sumatra currently cannot renew their rubber smallholdings for the lack of the
required capital amounting to rupiahs 6 million per hectare. If they can
anticipate the net return of collective investment, then they may realize that
there is a chance for future renewal.If this
collective action is extended to community members without land who are
currently working for the MHBM scheme, their net return will even be higher. In
the first game iteration, they collaboratively planted oil palm, but in the
second they concurrently planted rubber and participated in the MHR scheme.
From the simple case study, one can see evidence of the learning process
through playing the game. It is hard to determine whether an optimum solution
will emerge automatically if they cooperate, but it is possible that the
optimum solution will be discovered over time. Regardless optimality of chosen
strategy is not as important as social acceptability of chosen strategy. In a
case as complex as the problem addressed in this case study, “pareto
optimality" may only exist theoretically, but may be too elusive, if not
impossible, to determine.


## 3.4. Institutional Implications

Communication
had been shown to be an effective mechanism for increasing the likelihood that
stakeholders choose benefit-sharing strategies. For instance, in this study, communication
facilitated through RPG enabled the players to explore various strategies that
increased their cumulative incomes. These collective strategies emerged, in
part, from the participants’ realization that they might get better returns
given the payoff structure and if they collaborate and develop a group
strategy.The
experiment demonstrated the importance of communication and its potential in
increasing community benefits. This is particularly true when communication is
provided as a mechanism for the players to envisage a coordinated strategy. For
instance, in this experimental pilot study, an ex-postapplication of RPG at
the community led to the formation of communication institutions such as a
community forum at the village level and a multistakeholder forum at the
district level. However, community institutions are not costless and are not
formed easily and quickly. The community and other stakeholders need to invest
time and effort to establish these forums or arenas. This is particularly significant
because the communities surrounding the MHP plantations, used as the
experimental case study, are
subsistence community where most people live poorly with less than 1 USD per
day [23]. Hence, the MHP plantations influence the
traditional livelihoods of the community. Therefore, the level of cooperation
among community members may be strongly influenced by inherent competition
among the communities for the benefits derived from the plantations. This makes
the formation of community forums even more difficult, but strategically
significant.Communication
among community members as well as the effort to arrive at a coordinated
strategy may slow the decision-making process seeking fruitful partnership with
MHP. However, since forest- and land-related activities are long-term
investments, and realizing that impatience may undermine long-term social and
ecological sustainability [17], a slower and more deliberate
decision-making process particularly at the beginning is reasonable.Coordinated
strategy involves producing rules for sharing benefit and cost of any land use
option. In the case study, the establishment of a communication institution,
such as a formal forum, was deemed critical to the enforcement of these rules. Without
this rule enforcement capability, problems related to free riders and rent
seekers can emerge easily. Moreover, the problem of elite capture as described
by Platteau and Gaspart [16] can also diminish. Learning from RPG experiment,
the real stakeholders in Muara Enim District agreed to establish a forum,
called “Forum Sebahu Sejalan.” This forum was equipped with an explicit
constitution and rule, called anggaran
dasar and anggaran rumah tangga,
to guide the organization and execution of the forum.The forum
is envisioned to serve as a mechanism to bridge the community and MHP’s
interests. Through the coordinated strategy, and particularly the formal forum,
the community is positioned in an environment, where they are able to bargain
and negotiate with MHP. On the other hand, MHP also benefits from the forum
through reducing transaction cost of negotiation. Without the formal forum, MHP
traditionally deals with individual community members and leaders. With the
formal forum, a more balanced partnership can emerge from discussions between
community members, united by the common strategy, and MHP. For instance, in an
ex-postapplication of RPG, MHP has agreed to give a more transparent figure
about the overall plantation costs and returns in response to requests made by
the community. MHP also agreed to lend money to the community to enable them to
make better land use investments as well as pursue small plantation operational
contracts with MHP such as weeding and harvesting. This balanced and transparent
partnership can only make the partnership more resilient. The forum provides
both parties with a common ground to negotiate about regular issues such as
profit sharing at the end of rotation, as well as sensitive issues such as land
property ownership and access to resources.In
the case study, the “Forum Sebahu Sejalan” is also a place where the local government
of Muara Enim, South Sumatra communicates and negotiates with community members
and representatives. At the same time, local community can participate and
influence policy formulation on forest plantations such as benefit sharing,
plantation extent, production targets, and location. This forum is envisioned
as a mechanism to make the decentralization policies work better for forest
plantations at the district level. The forum, its constitution, and rules play
a role as institutional mechanisms that can encourage the local community to
cooperate with government officials and to promote more interactions between
less powerful community members and government officials.


## 4. Conclusion

This paper
described an experiment that examines the RPG method and how it can be used by
stakeholders to explore community-company partnerships. Based on the
experiences gained from the experimental case study, one can conclude that the
RPG method can help explore these partnerships, make them more transparent, and
create win-win scenarios for all stakeholders. From the simple case study, the
following were noted: (a) CORMAS is a useful platform to develop and carry out
simple spatially explicit role-playing game (RPG), (b) collaboration and
communication can design collective strategies that help improve community
livelihoods in the future, (c) the best solutions, or win-win relationships
among stakeholders, can be learned over continual RPG iteration, and (d) RPG
game can help players anticipate potential outcomes of their own decisions.Role-playing
game gave players insight into how collective investment is preferable to improve their future
livelihoods. The players learned as they discussed, played, and analyzed the
game. The game mimicked the interaction between communities living near the MHP
forest plantations, although it was simplified so that the exercise might be
applied to partnerships involving other local communities and forest plantation
companies. The results from the game also provided the rationale to establish a
costless communication institution called “Forum Sebahu Sejalan” in the
District of Muara Enim, South Sumatra . The
forum can play a significant role in building more resilient relationship
between local community and MHP. At the same time, the forum acts as avenue for
local community to access the government officials and to make decentralization
works better in
forest plantations at the district and the village levels.



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*Source: 451362-2009-03-04.xml*