Tragedy of the commons. In traditional game-theoretic models there are only two possible solutions: state management or privatization/markets.
But traditional models are far too simplified and miss crucial aspects of real-world problems. No communication, no monitoring, no repeated interaction, no probabilistic inference, no theory-of-mind etc. Different assumptions would provide different solutions.
Not just an academic curiosity - these models hugely influence policy decisions.
This book contains a collection of case studies of alternative solutions, and the beginnings of a framework within which to study them.
Not going to summarize all the case studies, just the interesting lessons.
Common themes for success:
- Clear rules about who is allowed access, which are effectively enforced.
- Rules are well-matched to the local conditions and take into account changing conditions.
- Collective-choice arrangement - appropriators have a say in the rules and can push for change.
- Effective monitoring of rules by monitors who are accountable to appropriators.
- Graduated sanctions - allows for forgivable mistakes while still sending clear signal of catch-and-punish.
- Cheap and timely access to trusted conflict-resolution mechanisms.
- Minimal recognition of right to organize - surrounding state doesn’t actively interfere with or undermine system.
- (For larger systems) Nested hierarchy of systems rather than one-system-to-rule-them-all.
Common objections are the creating the system and monitoring/enforcing it prevent two new second-order free-rider problems. But both have been known to work in practice, so must be missing something.
Creating systems seems to be incremental in practice. Small steps present less of a free-rider problem, and gradually increase confidence in the value of a working system, which weights future decisions.
Monitoring can be expensive or nearly free depending on the system itself. Eg in a turn-taking system, appropriators who have a turn on a good spot are incentivized to enforce their right, and other appropriators who want to have their turn in future are incentivized to back them up.
Monitoring also has individual benefits. Appropriators who adopt tit-for-tat strategies gain valuable information about defection rates by monitoring or paying for / supporting monitors.
Seems to be a common theme in many of the success stories of achieving mutual knowledge of the state of the commons - what resources are available, how willing is everyone else to cooperate, how much can they be trusted, who is allowed access to what resources, how much is each party taking out, what is the defection rate etc. Traditional models don’t usually even allow for mutual knowledge, let alone attach a value to obtaining it.