Mukand (Maks) RESET Flashcards
(48 cards)
Rustagi et al. (2010)
Conditional cooperation and costly monitoring explain success in forest commons management
Motivation: Rustagi et al. (2010) - Conditional cooperation and costly monitoring explain success in forest commons management
Forest-user groups differ dramatically in how well they protect common woodland. Classic free-rider theory can’t explain such variation. The authors test whether the mix of behavioural types — especially the share of conditional cooperators and their willingness to monitor & punish — accounts for success.
Data/Setting: Rustagi et al. (2010) - Conditional cooperation and costly monitoring explain success in forest commons management
49 forest-user groups (679 villagers) in Ethiopia’s Bale Mountains. Outcomes are ecological (health of young trees) and behavioural (patrol hours).
Methodology: Rustagi et al. (2010) - Conditional cooperation and costly monitoring explain success in forest commons management
(i) Each villager is classified via a public-goods “strategy method” game into a conditional co-operator, weak CC, free-rider, or altruist.
(ii) Regress forest health on the share of conditional cooperators, with controls for geography, demographics and programme years
(iii) Regress patrol hours on the share of conditional cooperators, with the same controls.
Robustness Checks: Rustagi et al. (2010) - Conditional cooperation and costly monitoring explain success in forest commons management
Results robust to full set of geographic & demographic controls:
(i) Structural factors (e.g. distance to market, year of enrolment) entered separately; CC share effect persists.
(ii) Free-rider share included: more free-riders and significantly lower PCT, confirming opposite channel.
(iii) Alternative outcome specifications (e.g., patrol hours, forest plot fixed effects) yield similar elasticities.
Results: Rustagi et al. (2010) - Conditional cooperation and costly monitoring explain success in forest commons management
Forests thrive when many villagers are conditional cooperators—these groups patrol more and suffer less from free-riding—whereas a higher share of free-riders undermines monitoring and degrades forest health.
Greif (1994)
Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
Motivation: Greif (1994) - Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
Why did the Maghribi Jewish coalition and the Genoese — trading the same goods on the same Mediterranean routes — adopt opposite ways to keep agents honest? Greif shows that shared cultural beliefs about others’ behaviour (individualist vs collectivist) dictate which enforcement institutions are feasible and, in turn, steer long-run trajectories.
Data/Setting: Greif (1994) - Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
(i) Maghribi evidence: Cairo Geniza letters and account books describe coalition-wide boycotts of any agent who cheated even once.
(ii) Genoese evidence: Notarial contracts reveal high incentive wages, reliance on courts and no collective-punishment norm.
Methodology: Greif (1994) - Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
Greif recreates the merchant–agent relationship as a repeated principal–agent game with hidden action. Two self-enforcing equilibria emerge, each anchored in a cultural belief system:
(i) Collectivist: everyone expects peers to punish a cheater, so reputational ostracism (a boycott) keeps agents honest at low cost.
(ii) Individualist: nobody expects peer punishment, so honesty must be bought with high wages and backed by courts.
A collectivist equilibrium is sustainable only when the prior belief that “others will punish” is strong enough; otherwise the individualist system prevails.
Robustness Checks: Greif (1994) - Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
(i) Both groups traded identical goods over the same Mediterranean routes, so technology, geography and product mix cannot explain their institutional split.
(ii) Archival triangulation—letters, ledgers and court contracts—avoids single-source bias.
(iii) Prediction match: boycott vows, network structure and wage patterns align with the model.
(iv) Scale test: collective enforcement weakens as networks grow, mirroring Maghribi decline and Genoese resilience.
(v) Alternative channels (legal capacity, market power) assessed and found insufficient once beliefs are included.
Results: Greif (1994) - Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies
Cultural beliefs shape institutions and long-run development.
(i) Maghribis’ shared expectation that “everybody boycotts a cheater” sustains low-cost, reputation-based trade — but it remains fragile when the community scales up.
(ii) Genoese scepticism about peer punishment drives them toward costly wage incentives and formal legal contracts, which are durable and scalable.
These contrasting enforcement regimes steer network structure, contract form and economic trajectories for centuries.
Motivation: Ostrom et al. (1999) - Revisiting the Commons: Local Lessons, Global Challenges
Hardin’s “tragedy” argued that common-pool resources must be privatised or nationalised to avoid ruin. Three decades of fieldwork reveal many communities that do conserve forests, fisheries and canals without either extreme. The paper distils why local self-governance sometimes works and probes whether those insights can be adapted to “planetary” commons like climate and oceans.
Ostrom et al. (1999)
Revisiting the Commons: Local Lessons, Global Challenges
Data / Setting: Ostrom et al. (1999) - Revisiting the Commons: Local Lessons, Global Challenges
(i) Synthesises hundreds of well-documented cases spanning farmer-run irrigation in Nepal, communal forests in Germany, Mongolian grasslands, Pacific fisheries and more.
(ii) Contrasts four property rights regimes (open access, group, private, and state) and reports typical incentives and failure modes.
Methodology: Ostrom et al. (1999) - Revisiting the Commons: Local Lessons, Global Challenges
Conducts a qualitative analysis: compares successful and failed commons and matches their institutional traits to ecological performance. The authors then extend the framework to global resources.
Robustness Checks: Ostrom et al. (1999) - Revisiting the Commons: Local Lessons, Global Challenges
(i) Cross-Ecosystem Consistency: the same 8 principles recur in forests, fisheries, irrigation and groundwater.
(ii) Predictive Power: cases missing several principles almost always collapse; those with most principles endure over decades or centuries.
(iii) Comparative Counter-Examples: top-down Soviet grassland schemes and poorly tailored market fixes degraded resources faster, highlighting the cost of ignoring local context.
(iv) Behavioural Foundations: lab evidence on conditional cooperation and reciprocal punishment supports the need for cheap monitoring and flexible sanctions.
(v) Scalability Probe: nested, information-sharing governance already underpins successful regional water treaties, suggesting the principles can scale when properly layered
Results: Ostrom et al. (1999) - Revisiting the Commons: Local Lessons, Global Challenges
(i) Local self-governance works, and the paper illustrates this with concrete cases.
(ii) Across these cases, successful systems consistently exhibit 8 design principles: clear boundaries, including user monitoring, graduated sanctions, and nested layers of governance.
(iii) Identify 4 extra hurdles when managing planetary commons: scale, cultural diversity, interlinked systems, rapid change and treaty unanimity.
(iv) Argue for polycentric solutions that embed local knowledge in multiple tiers of self-governance when managing global resources.
Almås et al. (2022)
Attitudes to Inequality: Preferences and Beliefs
Motivation: Almås et al. (2022) - Attitudes to Inequality: Preferences and Beliefs
There is a public debate on how big income gaps are, yet citizens mostly care whether the gap feels fair. The authors ask:
(i) Which sources of inequality (merit / luck) do people deem legitimate?
(ii) Does fairness outweigh efficiency?
(iii) How do these views vary across countries, income classes and age?
Data / Setting: Almås et al. (2021) - Attitudes to Inequality: Preferences and Beliefs
(i) Cross-country panel data on 60 countries.
(ii) Records track how participants split the money between two workers after treatments that vary the source of earnings (merit / luck).
(iii) The survey also tracks personal characteristics of participants (age, gender, education, etc.). An additional youth panel is compiled.
Methodology: Almås et al. (2021) - Attitudes to Inequality: Preferences and Beliefs
Treatment assigns how two workers get paid: based on merit or luck. Participants are then asked to split the money between them, if they feel so necessary.
Choices reveal whether they fall into 1 of 3 types: egalitarian (close every gap), meritocratic (respect effort-based gaps) and libertarian (respect all initial earnings).
Occasional trade-off tests insert a 50% deadweight loss of redistribution to see if fairness beats efficiency.
The authors also link these choices to personal characteristics and country.
Robustness Checks: Almås et al. (2021) - Attitudes to Inequality: Preferences and Beliefs
(i) The design separates normative fairness from self-interest because participants never receive any money themselves.
(ii) No matter the person, each participant always falls into 1 of 3 types.
(iii) Stability tests replicate the results in follow-up panels.
Results: Almås et al. (2021) - Attitudes to Inequality: Preferences and Beliefs
(i) Spectators are generally comfortable with inequality that reflects merit, but not luck
(ii) Lower-income and younger respondents lean more egalitarian; richer or older groups tilt meritocratic or libertarian (even after controlling for gender and schooling).
(iii) Richer countries lean more meritocratic/libertarian, while poorer contexts see more egalitarianism.
(iv) Fairness often trumps efficiency: many spectators erase luck gaps even when redistribution burns resources.
