Cooperation, Common Pool Resources and Incentives at the Sub-group Level

Abstract

"The (experimental) research on community management of natural resources focuses on social dilemma situations between individuals. However, in most real-life situations natural resources are not only shared between individuals living in a community, but also between individuals belonging to different subgroups within the same community. For instance, in the case of tropical fisheries, marine resource management typically involves balancing the needs of members from different villages who form the overall community as well as different types of resource users within the same community. Standard Common-pool resource (CPR) experiment does not capture the dynamics of these situations, as they focus only on individual motivations. We introduce four different variations to standard CPR experiment, where we manipulate the incentives at the subgroup level. These four variations include: (i) standard CPR experiment with sub-groups, (ii) CPR experiments where between subgroup competition is conducive to group level cooperation, (iii) CPR experiments where different sub-groups have different incentives to maintain group-level cooperation, and lastly (iv) nested CPR experiments where sub-group incentives are orthogonal to group-level cooperation. Preliminary findings suggest that, as expected, individuals extract lower amounts from the CPR when individual and sub-group incentives favor cooperation at the group level. Conversely, participants extract significantly higher amount in the case of nested Common-pool resources. Indeed, cooperation is hardest to maintain at both the subgroup and the group level in this case."