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Collective Action Dilemmas in Condominium Management

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  • Fang-Ni Chu
  • Chin-Oh Chang
  • Tien Foo Sing

Abstract

Condominium residents are reluctant to join the management committees (MCs) and contribute to the management of local public goods because of free-riding problems. In studying a sample of condominiums in Taipei, it is found that some degree of outsourcing to third party managers (TPMs) is necessary when the scale of local public goods increases. However, higher management fees paid to TPMs are not directly related to higher utilities derived by the residents in the use of local public goods. When self-selectivity in the outsourcing decision is controlled, the results show that the efficiency in the provision of local public goods increases with the effort levels of the MC members. The MC members who adopt a hands-off approach by fully delegating the management responsibilities to TPMs deliver lower pay-offs in the provision of public goods.

Suggested Citation

  • Fang-Ni Chu & Chin-Oh Chang & Tien Foo Sing, 2013. "Collective Action Dilemmas in Condominium Management," Urban Studies, Urban Studies Journal Limited, vol. 50(1), pages 128-147, January.
    • Handle: RePEc:sae:urbstu:v:50:y:2013:i:1:p:128-147
    DOI: 10.1177/0042098012452327
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    Cited by:

    1. Borisova, Ekaterina I. & Polishchuk, Leonid & Peresetsky, Anatoly, 2014. "Collective management of residential housing in Russia: The importance of being social," Journal of Comparative Economics, Elsevier, vol. 42(3), pages 609-629.
    2. Fukuju Yamazaki & Taisuke Sadayuki, 2017. "The Collective Action Problem in Japanese Condominium Reconstruction," International Real Estate Review, Global Social Science Institute, vol. 20(4), pages 493-523.

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