Effect of rule choice in dynamic interactive spatial commons

International Journal of the Commons Vol. 2, no 2 July 2008, pp. 288–312 Publisher: Igitur, Utrecht Publishing & Archiving Services for IASC URL:http://www.thecommonsjournal.org URN:NBN:NL:UI:10-IJC-0801 4 Copyright: content is licensed under a Creative Commons Attribution 3.0 License ISSN: 1875-0281 Effect of rule choice in dynamic interactive spatial commons Marco A. Janssen School of Human Evolution and Social Change & School of Computing and Informatics Arizona State University, Tempe Robert L. Goldstone Department of Psychological and Brain Sciences and Program in Cognitive Science Indiana University, Bloomington Filippo Menczer School of Informatics Indiana University, Bloomington Elinor Ostrom Department of Political Science and Workshop in Political Theory and Policy Analysis Indiana University, Bloomington Abstract: This paper uses laboratory experiments to examine the effect of an endogenous rule change from open access to private property as a potential solution to overharvesting in commons dilemmas. A novel, spatial, real-time renewable resource environment was used to investigate whether participants were willing to invest in changing the rules from an open access situation to a private property system. We found that half of the participants invested in creating private property arrangements. Groups who had experienced private property in the second round of the experiment, made different decisions in the Effect of rule choice in dynamic interactive spatial commons 289 third round when open access was reinstituted in contrast to groups who experienced three rounds of open access. At the group level, earnings increased in Round 3, but this was at a cost of more inequality. No significant differences in outcomes occurred between experiments where rules were imposed by the experimental design or chosen by participants. Keywords: Common-pool resources, institutional change, laboratory experiments, open access, private property Acknowledgements: We appreciate the support of the National Science Foundation for the grant ‘‘Dynamics of Rules in Commons Dilemmas’’ BCS0432894. Many people have been involved in this research. Robert Goldstone, Filippo Menczer, and Elinor Ostrom helped Janssen with the design of the experiment. Yajing Wang and Muzaffer Ozakca changed the original forager software of Robert Goldstone into the software we use for the experiments. Rachel Vilensky recruited the participants. Yajing Wang, Michael Schoon, Tun Myint, Elinor Ostrom, Pamela Jagger, and Frank van Laerhoven assisted Janssen in performing the experiments. Also, many graduate students, staff, and faculty pre-tested the experiments and we thank them for all of their help. Janssen did the data analysis with input from Takao Sasaki. We are appreciative of the excellent comments of two anonymous reviewers. 1. Introduction Renewable resources are generally overharvested in the field and in laboratory experiments when there are no rules limiting who can harvest or how much (an open access situation). One method potentially available to resource users is to select their own institutional rules for governing the use of a shared resource. In this paper we study whether people invest their own resources in institutional change and the implications of an endogenous rule change when a common-pool resource (CPR) is shared. CPR problems provide a valuable analytical situation for exploring the construction of institutional practices because individual, material self-interest is pitted against the achievements of higher group returns. Open access is CPRs basic social dilemma in which individuals have an incentive to harvest the resource at such a rate that, if everyone harvested at this rate, a collectively disadvantageous outcome would result. An example of such a social dilemma, known as ‘‘tragedy of the commons,’’ was observed in the collapse of the northern cod of Labrador and Newfoundland during the early 1990s (Finlayson and McCay 1998; Finlayson 1994). The closure of the cod fishery adversely affected thousands of fishing families and related businesses along the entire eastern coast of Canada. In this instance, a national government exercised control over the fishery but did not sufficiently limit harvesting and even subsidized the acquisition of new vessels (Finlayson 290 Marco A. Janssen et al. and McCay 1998: p. 320). In Maine, a dramatic contrast exists between CPRs where fishers have created strong rules to limit harvesting (in regard to lobster, see Acheson 2003) as contrasted to the lack of such rules (in regard to ground fish, see Dietz et al. 2003: Figure 1; Wilson 2002). A question of deep practical and theoretical importance is when, how, and why do the harvesters from a CPR resist overharvesting by imposing rules on themselves (as did the Maine lobster fishermen) as contrasted to continuing to overharvest (as did the Maine, Newfoundland, and Labrador cod fishermen). During the last 20 years, controlled experiments have been used to test hypotheses about how individuals are able to share common pool resources (Ostrom et al. 1994). The findings indicate the importance of communication and opportunity to sanction for fostering higher levels of cooperation. Many social science experiments are performed with undergraduate students attending universities in the United States or Western Europe. Critics of using experiments with human subjects ask: How representative are such groups? Experiments conducted in one or two hours with subjects who are relatively young are limited in their ability to provide strong data about long-term processes, about specific cultural patterns, or about the behavior of much older subjects familiar with the challenge of governing a commons. Recent experiments conducted with villagers living in remote regions of developing countries, however, have replicated findings obtained in laboratory´ controlled social dilemma experiments. Cardenas (2000) has, for example, replicated the core findings of extensive common-pool resource experiments conducted in the U.S. (Ostrom et al. 1994) with villagers living in remote ´ regions of Colombia (see also Cardenas et al. 2000). Because the Columbian villagers knew each other, rather than the anonymous conditions of the U.S. experiments, further information about relationships among small groups could also be studied. Henrich et al. (2004, 2006) report on experiments conducted in multiple field settings where the central tendencies of the research findings are similar to those obtained when participants are undergraduate students, but the variance is much higher and related to attributes of each local setting and the specific participants involved. Further, findings from laboratory settings about the importance of participants monitoring levels of cooperation have been substantiated by empirical field studies (Gibson et al. 2005; Hayes and Ostrom 2005; Ostrom and Nagendra 2006). Previous experiments in (...truncated)