Majoritarian Management of the Commons and Anti-Commons

Abstract

"Constitutional solutions to the commons problem are: (1) the assignment of ownership rights or privatization; and (2) the adoption of rules that limit usage. The commons problem arises when a productive resource is indivisible. Our emphasis is on majority decision rules. When separate majority coalitions may authorize simultaneous usage of a common resource, total value is dissipated, but the interdependencies introduced by possible membership in differing coalitions to an extent reduce the incentives for exploitation. The formal model is analogous to that familiar in Cournot-Nash oligopoly models, but with differing efficiency implications. The argument has relevance for differential-benefit public spending from general tax sources, as well as other applications.

"Our ultimate motivation for extending the commons metaphor to this applications rests on the central idea that democratic politics, as it operates, allows members of majority coalitions to impose external diseconomies on general taxpayers.

"Government actions emerge from separately formed fiscal coalitions, rather than from a monolithic collectivity. The general tax base is subject to exploitation by majority coalitions of differing composition.

"An anti-commons problem arises when there exist multiple rights to exclude. Michael Heller has used this, 'tragedy of the anti-commons' to explain observed failures to utilize existing facilities that remain potentially productive. We develop a formal economic model of the anti-commons, where resources are inefficiently underutilized rather than over-utilized as in the commons setting. The two problems are shown to be symmetrical in several respects. The majoritarian management of the anti-commons is analyzed by the stylized examples used in the commons case. The model seems directly applicable to many cases of bureaucratic regulation, where developers are required to secure permits from multiple agencies."