Better Living, Together / by Katie Edmonds

Today my research lead me to Elinor Ostrom, a Nobel Prize winning economist. She didn't study liquid capital or the behavior of markets, she studied Common Pool Resource management. CPRs are like a stone soup of economics, where some contribute to the benefit of all.

Those familiar with CPRs link them to game theory, where sharing is assumed to occur between people who can't/don't communicate, and who act in their own best interest (rational choice). The cold, hard zero-sum games that game theory studied in the 1940s and 1950s caught the attention of evolutionary biologists in the 1970s, and the assumptions about competition began to break apart. The fields discovered the success of tit-for-tat engagement and reciprocal altruism behaviors in the 1980s, bringing cooperation back into the conversation that had been dominated by ruthless self interest.

This self interest paradigm was based on the assumption that privatization is the only way prevent overuse and destruction of shared resources. Olstrom's research refuted this claim. She discovered that farmers in a Swiss village successfully maintained their commons. She was able to identify the principles that allowed them to be successful:

8 Principles for Managing a Commons

1. Define clear group boundaries.

2. Match rules governing use of common goods to local needs and conditions.

3. Ensure that those affected by the rules can participate in modifying the rules.

4. Make sure the rule-making rights of community members are respected by outside authorities.

5. Develop a system, carried out by community members, for monitoring members’ behavior.

6. Use graduated sanctions for rule violators.

7. Provide accessible, low-cost means for dispute resolution.

8. Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.

If you  look for them, you might find common pool resources all around you. The environment is one (we often break it up into pieces: water, air, land). The world wide web is another, both the front end (stuff you surf for) and the back end (the code base for the network). If you go the next step to the more abstract, you might see civil rights or personal safety as a common pool resource. The eternal optimist in me is validated by Ostrom's discovery.