IDEAS home Printed from https://ideas.repec.org/a/taf/jriskr/v17y2014i7p903-921.html
   My bibliography  Save this article

Measures of risk associated to regulations compliance: a laboratory experiment on the use of common-pool resources

Author

Listed:
  • Daniel Alfredo Revollo-Fernandez
  • Alonso Aguilar-Ibarra

Abstract

Analyzing the behavior of users of natural resources towards risk is of paramount importance to sustainability. This paper analyzes the degree of risk-aversion under an experimental setting, to different fishing control measures applied by an authority. In order to have a quantitative assessment of such attitudes, we applied four measures of risk-aversion, two are standard measures: the constant relative risk-aversion utility function, and the Arrow-Pratt absolute risk-aversion measure. Furthermore, we propose two new measures: risk-elasticity of extractions and a non-compliance risk index. The risk-aversion measured in this paper demonstrates that the sample studied with groups of students are, in general, risk-averse or slightly risk-loving (rather neutral) towards enforcement. The results show that, although a general tendency of lower extractions took place in comparison to a no-enforcement (i.e. open-access) treatment, a high level of enforcement (60% probability) led to higher extractions than at 20% and 40% enforcement level. There were also gender differences: women were more risk-averse than men. We conclude that there was a Motivation Crowding Effect present in players' behavior, and that gender differences are worth studying in further research on risk attitudes and management of common-pool resources.

Suggested Citation

  • Daniel Alfredo Revollo-Fernandez & Alonso Aguilar-Ibarra, 2014. "Measures of risk associated to regulations compliance: a laboratory experiment on the use of common-pool resources," Journal of Risk Research, Taylor & Francis Journals, vol. 17(7), pages 903-921, August.
    • Handle: RePEc:taf:jriskr:v:17:y:2014:i:7:p:903-921
    DOI: 10.1080/13669877.2013.822914
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/13669877.2013.822914
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/13669877.2013.822914?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gneezy, Uri & Rustichini, Aldo, 2000. "A Fine is a Price," The Journal of Legal Studies, University of Chicago Press, vol. 29(1), pages 1-17, January.
    2. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    3. Raakjær Nielsen, Jesper & Mathiesen, Christoph, 2003. "Important factors influencing rule compliance in fisheries lessons from Denmark," Marine Policy, Elsevier, vol. 27(5), pages 409-416, September.
    4. Cardenas, Juan-Camilo, 2004. "Norms from outside and from inside: an experimental analysis on the governance of local ecosystems," Forest Policy and Economics, Elsevier, vol. 6(3-4), pages 229-241, June.
    5. Agarwal, Bina, 2009. "Gender and forest conservation: The impact of women's participation in community forest governance," Ecological Economics, Elsevier, vol. 68(11), pages 2785-2799, September.
    6. Velez, Maria Alejandra & Stranlund, John K. & Murphy, James J., 2009. "What motivates common pool resource users? Experimental evidence from the field," Journal of Economic Behavior & Organization, Elsevier, vol. 70(3), pages 485-497, June.
    7. Depositario, Dinah Pura T. & Nayga Jr., Rodolfo M. & Wu, Ximing & Laude, Tiffany P., 2009. "Should students be used as subjects in experimental auctions?," Economics Letters, Elsevier, vol. 102(2), pages 122-124, February.
    8. Aaron Hatcher & Shabbar Jaffry & Olivier Thébaud & Elizabeth Bennett, 2000. "Normative and Social Influences Affecting Compliance with Fishery Regulations," Land Economics, University of Wisconsin Press, vol. 76(3), pages 448-461.
    9. Bruno S. Frey & Reto Jegen, 2001. "Motivation Crowding Theory," Journal of Economic Surveys, Wiley Blackwell, vol. 15(5), pages 589-611, December.
    10. Steven D. Levitt & John A. List, 2007. "What Do Laboratory Experiments Measuring Social Preferences Reveal About the Real World?," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 153-174, Spring.
    11. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-474, June.
    12. Rodriguez-Sickert, Carlos & Guzmán, Ricardo Andrés & Cárdenas, Juan Camilo, 2008. "Institutions influence preferences: Evidence from a common pool resource experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 67(1), pages 215-227, July.
    13. Elinor Ostrom, 2000. "Collective Action and the Evolution of Social Norms," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 137-158, Summer.
    14. Martin Smith & James Wilen, 2005. "Heterogeneous and Correlated Risk Preferences in Commercial Fishermen: The Perfect Storm Dilemma," Journal of Risk and Uncertainty, Springer, vol. 31(1), pages 53-71, July.
    15. Eckel, Catherine C. & Grossman, Philip J., 2008. "Men, Women and Risk Aversion: Experimental Evidence," Handbook of Experimental Economics Results, in: Charles R. Plott & Vernon L. Smith (ed.), Handbook of Experimental Economics Results, edition 1, volume 1, chapter 113, pages 1061-1073, Elsevier.
    16. Carsten Lynge Jensen & Bernt Aarset, 2008. "Explaining noncompliance in the Norwegian coastal cod fishery: an application of the multinomial logit," Applied Economics, Taylor & Francis Journals, vol. 40(4), pages 505-513.
    17. del Pilar Moreno-Sánchez, Rocío & Maldonado, Jorge Higinio, 2010. "Evaluating the role of co-management in improving governance of marine protected areas: An experimental approach in the Colombian Caribbean," Ecological Economics, Elsevier, vol. 69(12), pages 2557-2567, October.
    18. Ostrom, Elinor, 2006. "The value-added of laboratory experiments for the study of institutions and common-pool resources," Journal of Economic Behavior & Organization, Elsevier, vol. 61(2), pages 149-163, October.
    19. Luis Roberto Martínez & Christian Jaramillo & Nicolas De Roux & Juan-Camilo Cárdenas, 2010. "It´s Not My Money: An Experiment on Risk Aversion and the House-money Effect," Documentos CEDE 6712, Universidad de los Andes, Facultad de Economía, CEDE.
    20. Ernst Fehr & Urs Fischbacher, 2004. "Social norms and human cooperation," Macroeconomics 0409026, University Library of Munich, Germany.
    21. Jentoft, Svein, 2000. "Legitimacy and disappointment in fisheries management," Marine Policy, Elsevier, vol. 24(2), pages 141-148, March.
    22. Michael Kosfeld & Armin Falk, 2006. "The Hidden Costs of Control," American Economic Review, American Economic Association, vol. 96(5), pages 1611-1630, December.
    23. Joseph G. Eisenhauer, 2004. "Risk Pooling in the Presence of Moral Hazard," Bulletin of Economic Research, Wiley Blackwell, vol. 56(1), pages 107-111, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ma, Zhao & Bauchet, Jonathan & Steele, Diana & Godoy, Ricardo & Radel, Claudia & Zanotti, Laura, 2017. "Comparison of Direct Transfers for Human Capital Development and Environmental Conservation," World Development, Elsevier, vol. 99(C), pages 498-517.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kerri Brick & Martine Visser & Justine Burns, 2012. "Risk Aversion: Experimental Evidence from South African Fishing Communities," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(1), pages 133-152.
    2. Samuel Bowles & Sandra Polanía Reyes, 2009. "Economic Incentives and Social Preferences: A Preference-based Lucas Critique of Public Policy," CESifo Working Paper Series 2734, CESifo.
    3. Samuel Bowles & Sandra Polania-Reyes, 2011. "Economic incentives and social preferences: substitutes or complements?," Department of Economics University of Siena 617, Department of Economics, University of Siena.
    4. Barrero-Amórtegui, Yady & Maldonado, Jorge H., 2021. "Gender composition of management groups in a conservation agreement framework: Experimental evidence for mangrove use in the Colombian Pacific," World Development, Elsevier, vol. 142(C).
    5. Samuel Bowles & Sandra Polanía Reyes, 2009. "Economic Incentives and Social Preferences: A preference-Based Lucas Critique of Public Policy," UMASS Amherst Economics Working Papers 2009-11, University of Massachusetts Amherst, Department of Economics.
    6. Leibbrandt, Andreas & Lynham, John, 2018. "Does the allocation of property rights matter in the commons?," Journal of Environmental Economics and Management, Elsevier, vol. 89(C), pages 201-217.
    7. Daniel A. DeCaro & Marco A. Janssen & Allen Lee, 2015. "Synergistic effects of voting and enforcement on internalized motivation to cooperate in a resource dilemma," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 10(6), pages 511-537, November.
    8. Handberg, Øyvind Nystad & Angelsen, Arild, 2015. "Experimental tests of tropical forest conservation measures," Journal of Economic Behavior & Organization, Elsevier, vol. 118(C), pages 346-359.
    9. Tambunlertchai, Kanittha & Pongkijvorasin, Sittidaj, 2021. "Regulatory stringency and behavior in a common pool resource game: Lab and field experiments," Journal of Asian Economics, Elsevier, vol. 74(C).
    10. Epstein, Graham, 2017. "Local rulemaking, enforcement and compliance in state-owned forest commons," Ecological Economics, Elsevier, vol. 131(C), pages 312-321.
    11. Midler, Estelle & Pascual, Unai & Drucker, Adam G. & Narloch, Ulf & Soto, José Luis, 2015. "Unraveling the effects of payments for ecosystem services on motivations for collective action," Ecological Economics, Elsevier, vol. 120(C), pages 394-405.
    12. Handberg, Øyvind Nystad & Angelsen, Arild, 2019. "Pay little, get little; pay more, get a little more: A framed forest experiment in Tanzania," Ecological Economics, Elsevier, vol. 156(C), pages 454-467.
    13. repec:cup:judgdm:v:10:y:2015:i:6:p:511-537 is not listed on IDEAS
    14. Rode, Julian & Gómez-Baggethun, Erik & Krause, Torsten, 2015. "Motivation crowding by economic incentives in conservation policy: A review of the empirical evidence," Ecological Economics, Elsevier, vol. 117(C), pages 270-282.
    15. Apesteguia, Jose & Funk, Patricia & Iriberri, Nagore, 2013. "Promoting rule compliance in daily-life: Evidence from a randomized field experiment in the public libraries of Barcelona," European Economic Review, Elsevier, vol. 64(C), pages 266-284.
    16. Narloch, Ulf & Pascual, Unai & Drucker, Adam G., 2012. "Collective Action Dynamics under External Rewards: Experimental Insights from Andean Farming Communities," World Development, Elsevier, vol. 40(10), pages 2096-2107.
    17. Servátka, Maroš & Tucker, Steven & Vadovič, Radovan, 2011. "Words speak louder than money," Journal of Economic Psychology, Elsevier, vol. 32(5), pages 700-709.
    18. Jason Delaney & Sarah Jacobson, 2016. "Payments or Persuasion: Common Pool Resource Management with Price and Non-price Measures," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(4), pages 747-772, December.
    19. Anat Bracha & Chaim Fershtman, 2013. "Competitive Incentives: Working Harder or Working Smarter?," Management Science, INFORMS, vol. 59(4), pages 771-781, April.
    20. Danz, David & Engelmann, Dirk & Kübler, Dorothea, 2022. "Do legal standards affect ethical concerns of consumers?," European Economic Review, Elsevier, vol. 144(C).
    21. Agnès Festré & Pierre Garrouste, 2015. "Theory And Evidence In Psychology And Economics About Motivation Crowding Out: A Possible Convergence?," Journal of Economic Surveys, Wiley Blackwell, vol. 29(2), pages 339-356, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jriskr:v:17:y:2014:i:7:p:903-921. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RJRR20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.