Master thesis

4.2Elinor Ostrom - Governing the Commons:

The Nobel Prize award was bestowed upon Elinor Ostrom for her work on Common Properties. Her work contradicts Garret Hardin’s theory of the “Tragedy of Commons” and goes one step further to tell us that under certain conditions the commons have been effectively governed.

Elinor Ostrom, and others, argue that Hardin has an oversimplified approach in two ways; firstly, only private property or centralized government can save the environment in the long run and secondly, the resource users are locked in the tragedy dilemma, incapable of creating a solution⁹². “…many social groups, including the herders on the commons that provided the metaphor for his (Hardin) analysis, have struggled successfully against threats of resource degradation by developing and maintaining self-governing institutions”⁹³.

Ostrom argues that the logic of the tragedy of the commons rests on a set of assumptions about human behaviour concerning governance and the use of commons and of the nature of the resource⁹⁴. According to Ostrom, Hardin´s model is too simple to cover the reality of the commons and of human behaviour. “Human motivation is complex, the rules of governing the real commons do not always permit free access to everyone, and the resource systems themselves have dynamics that influence their response to human use”⁹⁵.

Ostrom states that, the empirical data from the last 30 years tell a rich and complicated story of the commons. Sometimes it is the history of Hardin´s tragedy, but often the results are filled with ambiguity and fall outside Hardin´s story⁹⁶. She opposes the view of the rational actor that dominates most economic theory, with a view that assumes that humans take account of the interests of the group. The tragedy of the commons presumes the only motivator to be self-interest and social mechanisms to control the self-interest, such as trust, communication and the ability to make binding agreements (formal or informal), is either lacking or unsuccessful⁹⁷. Ostrom does not reject that such conditions apply to some interactions, but sometimes people do move beyond the individual interest. Trust, communication and the anticipation of future interactions can control the self-interest enough to prevent the tragedy⁹⁸.

According to Ostrom and Runge, most users of common property resources, especially in the developing world, live in the same village where their families have lived for generations and plan to stay for generations to come. Given the general poverty facing most villagers and the unpredictability of the natural resources they all face, it is doubtful to suppose that the individuals have a “free-rider” strategy as a dominant motivation⁹⁹. Runge, as well as Ostrom, argues that common resource users in developing countries face a repeated coordination game instead of the one-try Prisoner´s Dilemma game, Hardin rely upon¹⁰⁰. In such situations all users would favour to limit their own use, as long as others committed themselves to the limitations as well. And the village institutions would provide a mechanism for the group as a whole to arrive at agreements that would ensure each user the others was committed to the agreed upon rules¹⁰¹. Therefore the issue of the commons would be a coordination problem and not a dilemma.

Ostrom agrees with Hardin, that without appropriate and effective governance institutions the environment and its natural resources will be in danger from increased population and consumption as well as overexploitation through modern technologies¹⁰². Each individual has an incentive to ignore the social costs of his resource use for fear that others will capture the benefits before he can. The lack of exclusion from the resource can thus create an incentive for aggregated use which exceeds the natural regeneration of the resource (Ostrom, 1985)¹⁰³. Although, local institutions have not always succeeded in maintaining the resource in question, neither have Hardin’s alternatives of either state- or private-ownership.

Ostrom uses the global ocean as an example of a threat of immense ecosystem degradation, resulting from; interplay among ocean ecology, fishing technology and inadequate governance¹⁰⁴. Ostrom criticizes the top-down national regimes and rule-systems and argues that it leaves the local users and -officials with insufficient autonomy and understanding to design effective institutions and management systems. Ostrom argue that; rules created on models that have no or little credibility among the users and as a result compliance to the rules have been relative low and strong resistance towards strengthening the existing restrictions¹⁰⁵.

According to Ostrom, the creation of governance systems for an sustainable use of the earth’s resources, that include a reasonable quality of life, involve making decisions under conditions that are uncertain, complex, with significant biophysical constrains and conflicting human values and interests¹⁰⁶. A set of laws or rules created under a certain socio-ecological environment, can change or erode as social, economical, environmental and/or technological development increase the potential for resource acquirement or change the environment from where the resource is collected¹⁰⁷. Furthermore Ostrom states that, humans have a tendency to devise methods for evading governance and therefore the rule-set needs to be able to evolve with the environment as a whole.

According to Ostrom, effective governance of commons is best achieved when:

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  The resources and use of the resources by humans can be monitored, and the information can be verified and understood at relatively low cost.
  
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  Rates of change in resources, resource-user populations, technology, and economic and social conditions are moderate.
  
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  Communities maintain frequent face-to-face communication and dense social networks.
  
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  Outsiders can be excluded at relatively low cost from using the resource.
  
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  The users support effective monitoring and rule enforcement.
  

Regarding dense social network and face-to-face communication, the argument is that it will increase trust among the members, allow people to express emotions and see reactions to distrust as well as lowering the cost of monitoring compliance to the rules. Exclusion of outsiders is important due to the increased harvesting pressure on the given resource and a typical lack of understanding of the rules by the newcomers.

Although, only very few situations in the world are characterized by all of these conditions, the challenge, according to Ostrom, is to create institutional arrangements that help facilitate such conditions, or as a main create governance in the absence ideal conditions¹⁰⁸. Ostrom refers to Robert M. Netting´s research in the Swiss Alps¹⁰⁹ and his five resource characteristics that would relate to forms of common property being created by the users¹¹⁰.

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  The value per-unit production is low
  
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  The frequency and dependability of yield is low
  
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  The possibility of improvement is low
  
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  The area required for effective use is large
  
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  The size of the group needed to make capital investments is large
  

The opposite characteristics would, according to Netting, make the users create forms of private property. Common property regimes developed under these conditions have been sustained for centuries without overexploiting the resource¹¹¹.

Under specific conditions common property regimes will be more beneficial than private property. These conditions would be when:

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  The cost of creating and enforcing private property rights is high
  
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  The economic value of the output is low
  
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  The benefits created by the resource are distributed with high spatial uncertainty
  

Under such conditions, a common property system would provide a way of reducing the risk of having nothing at all, in a period of time, and therefore preferable to private property¹¹².

According to Ostrom the research should be focused, not on a quest for the “correct” overall concept and the single right policy, but on an understanding of the conditions under which specific institutional models provide beneficial for the users in sustaining their resources over a long period of time, also known as design principles¹¹³.

In her book Governing the Commons: The Evolution of Institutions for Collective Action, from 1990, Ostrom formulated eight principles for where community based organization would function¹¹⁴, based on discussions on the National Research Council appointed panel on the Study of Common Property Resource Management, as well as a long series of field studies from all over the world.

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  Clearly defined boundaries (effective exclusion of external parties)
  
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  Rules regarding the appropriation and provision of common resources are adapted to local conditions
  
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  Collective-choice arrangements allow most resource appropriators to participate in the decision-making process
  
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  Effective monitoring by monitors who are part of or accountable to the appropriators
  
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  There is a scale of graduated sanctions for resource appropriators who violate community rules
  
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  Mechanisms of conflict resolution are cheap and of easy access
  
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  The self-determination of the community is recognized by higher-level authorities
  
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  In the case of larger common-pool resources: Organization in the form of multiple layers of nested enterprises
  

As mentioned in the method chapter, the last point will not be part of the analysis in this thesis, as the focus of the thesis is not on the large scale organisation of the Indian Commons.

To summon up on the theory chapter, the key aspects from the two theories are; from Hardin´s: The individuals are solely motivated by personal gains, they are a homogeneous group with no difference in terms of culture, skills and assets, they have a fear of losing access if they don´t exploit before someone else does, the open access to the resource and that the users are trapped in the Tragedy and are unable to resolve the situation themselves, and thereby unable to create local institutions to manage the commons effectively. As the solution to the Tragedy Hardin has two options; private property or government control.

The key aspects from Ostrom, as stated in her design principles, are; cheap and easy exclusion of outsiders, a high cost of enforcing private property, an effective and local decision-making process, effective monitoring of both users and the resource, guaranties sanctions toward rule breakers as well as accountability towards the rules, easy and local conflict resolution and the recognition of the local authority by government officials.

With this, the focus of the analysis will be to investigate the field data through the lens of the two theories to understand the condition of the Commons and the motivations of the appropriators for their usage and management of the CPRs.