Appropriating the Commons: A Theoretical Explanation
Centre for Economic Policy Research, 2001 - Commons - 62 pages
In this Paper we show that a simple model of fairness preferences explains major experimental regularities of common pool resource (CPR) experiments. The evidence indicates that in standard CPR games without communication and without sanctioning possibilities inefficient excess appropriation is the rule. When communication or informal sanctions are available, however, appropriation behaviour is more efficient. Our analysis shows that these regularities arise naturally when a fraction of the subjects exhibits reciprocal preferences.
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advantageous inequality appropriation decisions Armin Falk assume average appropriation best reply best response behavior Bolton and Ockenfels CCEs CEPR common pool resources communication cooperative behavior cooperative outcomes coordination game CPR problems defectors deviate disadvantageous inequality equity Ernst Fehr evidence experimental fairness models Falk and Fischbacher Fehr and Fischbacher Fehr and Gachter Fehr and Schmidt final period Fischbacher 1999 free-riders game theory game with punishment Gardner and Walker group members high appropriation impact incentive individual inequity averse player inequity averse subject institutional set-up interaction low appropriation material payoff model predicts monetary payoff Nash equilibrium Ockenfels 2000 players choose presence of reciprocal Prisoner's Dilemma Proposition 3.2 public goods games rational choice theories reciprocal preferences reciprocal subjects repeated game sanctioning opportunities sanctioning possibilities Schmidt model selfish players selfish subjects social optimum standard CPR game strategy symmetric equilibria theory University of Zurich utility function utility loss Weber and Messick xsne zero