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Group Size and Collective Action: Third-Party Monitoring in Common-Pool Resources

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Type: Working Paper
Author: Agrawal, Arun; Goyal, Sanjeev
Date: 1999
URI: https://hdl.handle.net/10535/3797
Sector: Forestry
Region: Middle East & South Asia
Subject(s): collective action
game theory
monitoring and sanctioning--theory
forest management
common pool resources
collective action
monitoring and sanctioning
Abstract: "This paper examines the hypothesis that group size is inversely related to successful collective action. A distinctive aspect of the paper is that it combines a non-cooperative game-theoretic approach with the analysis of primary data collected by the authors. "The game-theoretic model considers a group of people protecting a commonly owned resource from excessive exploitation. The monitoring of individual actions is a collective good. Our analysis focuses on third-party monitoring. We examine two significant aspects of all common-pool resources protected by third parties: one, the lumpiness of the monitoring technology and two, imperfect excludability from the common. We propose a general argument as to why costs of third-party monitoring will rise more than proportionately as group size increases. In combination with the lumpiness assumption, it yields us the following theoretical conclusion: medium sized groups are more likely than small or large groups to provide third-party monitoring. "The empirical analysis investigates the validity of this conclusion in a real life situation. We consider data on 28 forest councils from Kumaon in the Indian Himalaya. In consonance with the theoretical result, medium sized councils are the ones that successfully raise the funds necessary for third-party monitoring. Small and large councils fare badly. We present additional evidence to support our argument, and point toward future arenas of research on the relationship between monitoring and group size."

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