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Abstract:
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"In rural areas of developing countries, farming systems tend to be household-based. These household production systems are also highly integrated with land-based natural resources such as forests, range areas and pasture lands. Households depend on these resources for fuels, animal food, building materials, fruits and medicines, and often these resources have ownership and control structures that are something other than private property. Forms of 'common' ownership and control are by far the most important structures in which households access the land-based natural resources that support production by often poor, rural households. Indeed, common land areas can provide very significant portions of incomes for certain populations. For example, local commons contributed 15-25 percent of total income among households in eighty Indian villages (Jodha, 1986).
"Because common lands are important for the poor of the world, and also because they may house significant biodiversity and other non-production oriented natural resources, their current and future status is important (World Bank 1992). Indeed, some have argued that community management of resources should be a critical component of strategies promoting sustainable development (Leach et al. 1999). Because we care about the status of common lands, the effectiveness with which these land-based, common natural resources are managed is of interest to us. An important goal of management should be to maximize the long run economic rents from natural resources, and it has been because of a belief that commonly owned and controlled natural resources generate little or no rents that researchers have long questioned the incentives for efficient use of common resources (Gordon, 1954; Scott, 1955; Crutchfield 1956; Hardin, 1968). These analysts argued that commons generate little or no value, because rents are dissipated due to poor or absent management. As a result, solutions were proposed such as command and control management (Hardin 1968) or privatization of the commons (Demsetz 1964).
"More recently, however, an enormous literature has emerged which emphasizes the distinction between lack of ownership and control (open access) and community ownership and management (common property) (e.g., Wade 1988, Ostrom 1990, Bromley 1990, Baland and Platteau 1996). The impetus for trying to understand and in some cases advocating for community management often has something to do with reconciling the need to generate rents with the reality that natural resource rents should be distributed in a manner which recognizes the dependence of vulnerable groups on common lands. Due to work by Robert Wade, Elinor Ostrom, Daniel Bromley and others, it is now well accepted that natural resources do not have to be privately owned to be managed well. There therefore does not seem to be an inevitable contradiction between efficiency and non-exclusivity in the case of land resources (Baland and Platteau, 1996).
"In the policy literature, the recognition that common management is strongly preferred to no management, and indeed can be efficient, has created a conventional wisdom which advocates for devolution of natural resources from central government owners to local groups. Devolution of forests has, for example, been underway in Nepal since the early 1980s and culminated in the transfer of all forest land to local forest users through the creation of forest user groups in 1993 (cited in Edmonds 1998). The FAO, for example, actively supports community forestry in several countries through its Forests, Trees and People Program. Agrawal (2000), referring to a recent FAO survey, mentions that Governments in more than 50 countries are undertaking initiatives that would devolve some control over resources to local users.
"Although local control over natural resources is now regarded as a win-win solution for both the environment and local development, the empirical evidence in its support is still rather thin. Case studies form the overwhelming majority of this material and the results are perhaps still more suggestive than conclusive. In this paper we advance this line of research by formally modeling the household production system in the Bolivan Andes. This approach provides a sound theoretical framework to analyze household behavior in conditions where non-market goods are important (Bocksteal and McConnell 1981). We then attempt to estimate the importance of institutional effectiveness in natural resource management on households' use of the commons."
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