Browsing by Author "Araral, Eduardo K."

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Decentralization Puzzles: A Political Economy Analysis of Irrigation Reform in the Philippines
(2006) Araral, Eduardo K.
"In the 1970's, the Philippines embarked on a program to decentralize the management of public irrigation. Early studies have shown that these reforms led to consistently positive results and earned widespread international documentation and recognition as a role model. Twenty years later, however, an examination of the program now indicates problems of poor performance. "How could poor performance occur in a system known worldwide for its major decentralization efforts? How are the incentives faced by key irrigation players linked to performance? What factors may have influenced these incentives? These questions build on the literature of decentralization, collective action, bureaucracies, foreign aid, common pool resources and irrigation institutions in developing countries. "To explain this puzzle, I hypothesize that, first, irrigation performance is linked to inherent incentive problems faced by public agencies. Second, these incentive problems can be aggravated by the incentives embedded in foreign aid particularly by the moral hazard problem. Third, I argue that performance is also a function of the incentives faced by farmers as shaped by their physical, social and institutional context. "I examine the hypothesis on bureaucratic and foreign aid incentives using panel data describing the performance of the irrigation agency. To test my hypotheses about farmer's incentives, I examined a cross section data on 2,056 irrigation associations. I examined archives, conducted field work from 2003-2005 and employed key informant interviews, focus group discussions, photo-documentation, participant-observation and focused on conceptual and measurement reliability issues. "My findings confirm my hypotheses. I find that irrigation performance in the Philippines is characterized by a cycle of chronic underinvestment in maintenance, deterioration of facilities, poor water service, low productivity and poor farm incomes. Bureaucratic self interest drives the problem of underinvestment in maintenance and can be aggravated by incentives embedded in foreign aid. Underinvestment is also driven by farmer's incentives to free ride which differs between labor and monetary contribution. Finally, I find how different configurations of physical, social and institutional factors have different effects on farmer incentives. "The study has implications for 25 developing countries undertaking irrigation reforms and faced with the same issues of poor performance and incentive problems."
The Effects of Geography on Property Rights in the Commonos: Theory, Evidence and Implications
(2013) Araral, Eduardo K.
"In the Northern Region of the Philippines can be found at least three different types of property rights in the same production system operated by the same ethnolinguistic group that has survived for long periods of time. To explain this puzzle, I provide a geographic risk model and building on Libecap’s (1989) contracting costs of property rights. I argue that these property systems essentially evolved in equilibrium overtime in response to these geographic risks. I illustrate my model with a comparative study of ancient commons (irrigation) with varied geography and property rights. My findings are consistent with the theoretical expectations. In the mountainous Ifugao region, where there is a need to maintain the ecological integrity of the watershed, the size of rice terraces, and kinship as basis of social order, the primogeniture system of property rights has developed in the last 2000 years. In the 400 year-old Zangjeras, where flooding and droughts require regular mobilization of labor, a unique property system of membership shares -- atar -- has developed. In the Cagayan Valley, where there is little risk of floods and droughts, typical modern private property rights have been adopted. The paper has four implications. First, it suggests that risk analysis should be incorporated into the study of the emergence and evolution of institutions in general and property rights in the commons in particular. Second, it helps explain the causes, consequences, diversity and vulnerability of institutions governing the commons. Third, the emergence, assignment, enforcement and transfer of property rights have important implications for the allocation of resources and the nature of production in the commons. Finally, understanding the effects of geographic risks has important practical implications for climate adaption in the commons and smallholder agriculture in particular."
The Impact of Decentralization on Large Scale Irrigation: Evidence from the Philippines
(2011) Araral, Eduardo K.
"Decentralization has often been prescribed as an institutional panacea for a wide range of problems facing developing countries. This study investigates the impacts of decentralization on the ability of individuals to solve collective action problems in a large-scale common pool resource. Using econometric analyses of a data set from the largest (83,000 hectares [ha]) irrigation system in the Philippines, the study finds that decentralized subsystems are more likely to solve collective action problems such as free-riding, conflict resolution and rule enforcement. These findings are consistent with the theoretical and empirical literature but they highlight the importance of credible enforcement. These preliminary findings offer insights for the design of institutions for collective action in situations of large-scale collective action."
The Ostrom Workshop and Its Contributions to a Second Generation Research Agenda in Policy Studies
(2013) Araral, Eduardo K.; Amri, Mulya
"A growing number of notable scholars are arguing recently that the policy studies literature has seen its 'salad days'. Political science in particular, Peters argue, has not made significant theoretical and empirical contributions to the policy studies literature in the 1980s. Peters attribute this decline to 'the dominance of methodological individualism and to a lesser extent with behavioralism' in the political science literature. He notes that policy scholars have been turned off by the '(seemingly) simple assumptions of rational choice models which are insufficient to capture the complex processes through which policies are formulated and then implemented.'"
A Transaction Cost Approach to Climate Adaptation: Insights from Coase, Ostrom and Williamson and Evidence from the 400-year Old Zangjeras
(2013) Araral, Eduardo K.
"I argue in this paper that transaction cost is central to the analytics of climate adaptation in the local commons. I illustrate this by bringing together insights from Coase on tradability of property rights, Ostrom on institutional design principles for long lived commons and Williamson on transaction cost and governance mechanisms. I call this the COW model on the analytics of climate adaptation, which I illustrate using grounded theory in the case of the 400-year old zangjera irrigation societies in Northern Philippines. The zangjeras are highly vulnerable to climatic risks but has successfully managed to adapt steadily overtime. I argue that their ability to adapt is a function of transaction cost which is associated with some ingenious principles of institutional design such as: (1) clear allocation and tradability of rights and obligations; (2) fairness in the allocation of risks, costs and benefits; (3) reliance on prices and incentives as adaptation mechanisms; (4) adaptive efficiency, i.e. maximization of welfare at least adaptation cost; (5) reliable enforcement mechanisms; and (6) a polycentric structure of governance. I conclude that the COW model can provide a useful foundation for the analytics of climate adaptation."
What can Institutional Analysis Tell Us about Long Lived Societies? The Case of the 2000 Year Old Ifugao Society
(2009) Araral, Eduardo K.
From Introduction: "The phenomenon of collapsed societies raises an interesting question: why have these societies failed to produce a sufficient response to their circumstances? This question has prompted other scholars--for example Diamond (2005) - to explain how some societies survived in difficult environments and persist overtime, 1,100 years in the case of Icelanders, 3,200 years in the case of Tonga and some 7,000 years in the case of New Guinea Highlands. "This paper examines the case of the 2000 year old Ifugao rice terraces in the Philippines - a UNESCO World Heritage Site and a globally important agricultural heritage site by the Food and Agriculture Organization - to explain, using the theoretical lenses of institutional analysis, why they have remained robust overtime."
What makes Socio-Ecological Systems Robust? An Institutional Analysis of the 2000 Year-old Ifugao Society
(2012) Araral, Eduardo K.
"Scholars have often puzzled over why ancient socio-ecological systems (SES) have collapsed or survived overtime. This paper attempts to explain the case of the 2,000-year old Ifugao SES and the contemporary challenges they now face. Five observations can be drawn. First, the Ifugao case does not fit some of the conventional theoretical explanations for the collapse or survival of SES. Second, the Ifugao’s primogeniture system of property rights along with the their customary laws and practices have played important roles in maintaining the robustness of their SES in the past 2,000 years through their effects on ecological integrity. Third, the Ifugao SES today is faced with contemporary challenges with varying effects on its robustness: integration into a postcolonial social order, the effects of tourism and agricultural development, migration, urbanization and the introduction of Christianity and mass education. Fourth, despite these changes, the collapse of the Ifugao SES is not a certainty (i.e. shift to a new domain of attraction that cannot support a human population, or that will induce a transition that causes long-term human suffering)."