It Works in Practice: Does It Work in Theory?

Abstract

"In 1968, Hardin argued that all commonly-owned resources would tragically be depleted unless private ownership was granted. There are many case studies which prove Hardin wrong. Common-pool resources have been managed with success. However, this success does not imply (as some believe) that communal ownership and management 'works' and is the appropriate management style for all resources. At the very least, the word 'works' needs definition.

"The Japanese village of Hirano used a lottery mechanism to distribute winter fodder gathered on village-owned land. It is true that the fodder gathering and distribution system worked- the villagers used this system from the 1600's to the 1950's. But, the question remains: was the mechanism effective in curtailing excessive harvesting from the commons? The results of this economic experiment suggest that the lottery mechanism greatly enhances the efficient use of the resource by reducing individual incentives to over-appropriate. Despite the effectiveness of this mechanism, it is not the case that individuals act in the manner suggested by economic theory. Further research is necessary to understand how individuals operate in this environment."