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Success and failure of communities managing natural resources: Static and dynamic inefficiencies

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  • Libois, François

Abstract

This paper presents an analytical framework to help understand why some communities successfully manage their renewable natural resources and some fail to do so. We develop a finite-number-of-player, two-period non-cooperative game, where a community can impose an exogenous amount of sanctions. The model develops a nuanced view on Ostrom’s conjecture, stating that, in a common-pool resource it is easier to solve the within-period distributional issue than the between-period conservation problem. We first show that rules preventing dynamic inefficiencies may exist even though static inefficiencies still remain. Second, we show an increase in the initial value of the resource may lower the utility of all users when enforcement mechanisms are bounded. Third, we show that inequalities decrease static inefficiencies but increase dynamic ones.

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  • Libois, François, 2022. "Success and failure of communities managing natural resources: Static and dynamic inefficiencies," Journal of Environmental Economics and Management, Elsevier, vol. 114(C).
    • Handle: RePEc:eee:jeeman:v:114:y:2022:i:c:s0095069622000444
    DOI: 10.1016/j.jeem.2022.102671
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    Cited by:

    1. François Libois & Jean-Marie Baland & Nicolas Delbart & Subhrendu Pattanayak, 2021. "Community Forest Management: The story behind a success story in Nepal," DeFiPP Working Papers 2106, University of Namur, Development Finance and Public Policies.
    2. Philippe Delacote & Julia Girard & Antoine Leblois, 2019. "Agricultural households' adaptation to weather shocks in Sub-Saharan Africa: What implications for land-use change and deforestation," Working Papers 1902, Chaire Economie du climat.
    3. Riekhof, Marie-Catherine & Noack, Frederik, 2024. "Nature’s decline and recovery — Structural change, regulatory costs, and the onset of resource use regulation," Journal of Environmental Economics and Management, Elsevier, vol. 125(C).

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    More about this item

    Keywords

    Common-pool resource; Renewable resource; Conservation; Sanctions; Institutions;
    All these keywords.

    JEL classification:

    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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