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Course requirements
• Essay / short paper (2000-2500 words): 25%
• Presentation (15min + 15min discussion): 25%
• Oral exam (based on essay & presentation): 50%
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Timeline
Date
18.2. Institutions
25.2. Institutions II
4.3. Classical Institutionalism and New Institutional Economics
11.3. Property rights and resource regimes, Commons
18.3. Doughnot Economics: From Planetary Boundaries to thinking how an
economy can be regenerative by design (Claudio Cattaneo)
25.3. Application of the doughnut at the city scale with Barcelona as an
example (Claudio Cattaneo)
1.4. Ecological Resource Economics
8.4. Applications: water, forests, fisheries
15.4. <Great Friday>
22.4. The Water–Energy–Food Nexus in India
29.4. Q&A, discussion
6.5. Presentations I
13.5. Presentations II
20.5. Debate, Open Space, Experiment
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Governing the commons
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The “discovery” of common-pool resource
governance
• Theory: Market vs. State, Public vs. Private (dichotomies)
• Challenge: Global resource over-exploitation
• Solution: Privatization or state ownership (framed as “tragedy of the
commons”) (Hardin, 1968)
• Alternative: Community-based resource management (common
property regime) with rules (of access, use, maintenance) (E.Ostrom,
1990)
• Parallel: Centralization of public goods versus polycentric governance
(V.Ostrom, Tiebout, Warren, 1961)
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Characteristics of Goods and Services
Excludability
High Low
Subtractability
of
use
High Private Goods
Common-Pool
Resources
(also Open Access R.)
Low
Club Goods
(Toll Goods)
Public Goods
(Collective Goods)
• Binary distinction between Private and Public Goods (Samuelson)
• Club Goods (Buchanan, 1965)
• Common-Pool Resources (subtractability rather than rivalry, low-high
continuum) (V.Ostrom and E.Ostrom, 1977)
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Property Regimes
• Property Rights include Rights and Duties/Obligations (streams of
benefits and costs)
Property
Regime
Owner Owner rights Owner duties
Private
Property
Individual
Socially acceptable
uses, control of
assets
Avoidance of socially
unacceptable uses
Common
Property
Collective
Exclusion of non-
owners
Maintenance, constrain
rate of use
State
Property
Citizens Determine rules
Maintain social
objectives
Open
Access
None Capture None
Source:Hannaetal.1996
• “Tragedy of the Commons“ à “Open Access”
à not Common Property Regime 10
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Elinor Ostrom received the 2009 Nobel Memorial Prize in Economic
Sciences
"for her analysis of economic governance, especially the commons“
She entitled her Nobel Address
“The Polycentric Governance of Complex Economic Systems”
Available here:
https://www.youtube.com/watch?v=T6OgRki5SgM
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Characteristics of Goods and Services
Excludability
High Low
Subtractability
of
use
High Private Goods
Common-Pool
Resources
(also Open Access R.)
Low
Club Goods
(Toll Goods)
Public Goods
(Collective Goods)
• CPRs ≠ Commons (incl. Public Goods) ≠ Common property regime
• How would you describe the following goods and services?
Food item; swimming pool; television; cinema; movie screening in a
cinema; book (copyright license, commons license); Wikipedia; national
social security system; land; water; global atmosphere; biodiversity? 12
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Characteristics of Goods and Services
Excludability
High Low
Subtractability
of
use
High Private Goods
Common-Pool
Resources
(also Open Access R.)
Low
Club Goods
(Toll Goods)
Public Goods
(Collective Goods)
• Many goods and services provided by ecosystems show
characteristics of public goods (PG) or common-pool resources (CPR)
• Low excludability provides incentive to free-ride à May result in
over-use (CPR & OAR) or insufficient provision (PG)
• Low excludability may be technically or normatively determined, and
may, thus, change over time 13
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Commons in Czechia
What are common-pool resources in Czechia, and how are they
governed?
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Commons, Climate, and International Relations
• Why the climate could be a common good, but is still open access
• And why the climate problem is not a Prisoner’s Dilemma
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The problem of social order and the
Prisoner’s Dilemma story
Vatn 2005, p. 27
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Prisoners’ Dilemma (PD)
Self-interest
produces worse
outcome?
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resource user 1
use sustainably exploit egoistically
resource user 2
use
sustainably
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3
4
1
exploit
egoistically
1
4
2
2
(Brams, 1993, American Scientist) =
Ø Widely used to study
cooperation in biology,
ecology, philosophy, law,
social sciences
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CPR management and the PD
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Ø Research question:
Is CPR management best represented by PD models?
(e.g. model simplifications in macroeconomics & financial crisis)
Ø Implications for teaching
?
PD mentioned in >3000 law review articles, other
models virtually ignored
(McAdams 2008)
“The two-person iterated PD is the E. coli of
the social sciences”
(Axelrod 1997)
Common-pool resources are not PDs
(Runge 1981, Cole and Grossman 2014)
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PD models – a success story
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Common-pool resource = PD
(Dawes 1973)
1950
2010
“Tragedy of the Commons”
(Hardin 1968)
Ø Privatization or State
“Cooperation among egoists”:
Repeated PDs, TIT-for-TAT
(Axelrod 1981)
Governing the Commons
(Ostrom 1990)
Ø Reciprocity, Fairness, and
Folk Theorems of repeated PDs
Ø Beyond market vs. state
First mentioning of the PD model
(Dresher and Flood 1950, Tucker 1950)
Ø Widely used in biology,
ecology, philosophy, law,
social sciences
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PD models – a success story?
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Common-pool resource = PD
(Dawes 1973)
1950
2010
“Tragedy of the Commons”
(Hardin 1968)
“Cooperation among egoists”:
Repeated PDs, TIT-for-TAT
(Axelrod 1981)
Governing the Commons
(Ostrom 1990)
Isolation Paradox, Assurance
in CPRs
(Runge 1981)
Herder Problem =
Assurance Problem
(Cole and Grossman 2010)
First mentioning of the PD model
(Dresher and Flood 1950, Tucker 1950)
Ø Axelrod (1981) cited 30.000 times! Ø Runge (1981) cited 420 times
Assurance Problem
(Sen 1967)
Ø Reciprocity, Fairness, and
Folk Theorems of repeated PDs
Ø Widely used in biology,
ecology, philosophy, law,
social sciences
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hunter 1
hunt stag together hunt hare alone
hunter 2
huutstag
together
4
hunthare
alone
4
2
2
Assurance Problem (AP)
§ Strategies depend on beliefs about the likely choices of others
§ Expectations can create self-fulfilling outcomes
§ Strategic and resource uncertainties
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“Stag Hunt”
(Rousseau 1755, game-theoretic
interpretation by Lewis 1969)
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Differences between PD and AP
RU1
C ooperate D efect
RU2
C
3
3
4
1
D
1
4
2
2
RU1
C D
RU2
C
4
4
3
1
D
1
3
2
2
Prisoners’ Dilemma (PD) Assurance Problem (AP)
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(Dresher, Flood, Tucker 1950)
§ Independent decisions
(in one-stage models)
§ Cooperation difficult
(Sen 1967)
§ Interdepent decisions,
jointness of production
§ Cooperation possible
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