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Using Rules to Screen for Cooperative Types: Rule-Following and Restraint in Common Pool Resource Systems

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  • Kimbrough Erik O.
  • Vostroknutov Alexander

    (METEOR)

Abstract

We argue that rules and rule-following provide a key means of solving social dilemmas by revealinginformation about individual willingness to cooperate, thereby facilitating assortative matchingand the exclusion of non-cooperative types. Rules impose costs on prospective entrants to anygroup and ensure thatonly those willing to pay such costs will join. To illustrate this point, we study a novel,repeated common pool resource game in which current resource stocks depend on resource extractionin previous periods. We show that for a sufficiently high regrowth rate, there is no commonsdilemma: the resource will be preserved indefinitely in equilibrium. Behavioral tests of the modelindicate that favorable ecological characteristics are necessary but insufficient to encourageeffective CPR governance. However, by screening and sorting individuals according to theirwillingness to follow costly rules in an individual choice task, we show that CPR groups composedof rule-followers are less likely to exhaust the resource than both groups of rule-breakers andmixed-type groups.

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Bibliographic Info

Paper provided by Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR) in its series Research Memorandum with number 055.

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Date of creation: 2012
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Handle: RePEc:unm:umamet:2012055

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Web page: http://www.maastrichtuniversity.nl/
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Keywords: public economics ;

References

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  1. Kevin McCabe & Mary Rigdon & Vernon Smith, 2004. "Sustaining Cooperation in trust Games," Experimental 0403005, EconWPA.
  2. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414.
  3. Anna Gunnthorsdottir & Daniel Houser & Kevin McCabe & Holly Ameden, 2004. "Disposition, History and Contributions in Public Goods Experiments," Experimental 0401001, EconWPA.
  4. 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.
  5. Maria Alejandra Vélez & John K. Stranlund & James J. Murphy, 2005. "What Motivates Common Pool Resource Users? Experimental Evidence from the Field," Working Papers 2005-4, University of Massachusetts Amherst, Department of Resource Economics.
  6. Marco Janssen & John Anderies & Sanket Joshi, 2011. "Coordination and cooperation in asymmetric commons dilemmas," Experimental Economics, Springer, vol. 14(4), pages 547-566, November.
  7. Lluis Bru & Susana Cabrera & C. Capra & Rosario Gomez, 2003. "A Common Pool Resource Game with Sequential Decisions and Experimental Evidence," Experimental Economics, Springer, vol. 6(1), pages 91-114, June.
  8. Erik O. Kimbrough & Alexander Vostroknutov, 2012. "Rules, Rule-Following, and Cooperation," Discussion Papers dp12-15, Department of Economics, Simon Fraser University.
  9. Daniel Houser & Michael Keane & Kevin McCabe, 2002. "Behavior in a dynamic decision problem: An analysis of experimental evidence using a bayesian type classification algorithm," Experimental 0211001, EconWPA.
  10. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  11. H. Scott Gordon, 1954. "The Economic Theory of a Common-Property Resource: The Fishery," Journal of Political Economy, University of Chicago Press, vol. 62, pages 124.
  12. Walker, James M. & Gardner, Roy & Ostrom, Elinor, 1990. "Rent dissipation in a limited-access common-pool resource: Experimental evidence," Journal of Environmental Economics and Management, Elsevier, vol. 19(3), pages 203-211, November.
  13. McCabe, Kevin & Houser, Daniel & Ryan, Lee & Smith, Vernon & Trouard, Ted, 2001. "A Functional Imaging Study of Cooperation in Two-Person reciprocal Exchange," MPRA Paper 5172, University Library of Munich, Germany.
  14. Walker, James M & Gardner, Roy, 1992. "Probabilistic Destruction of Common-Pool Resources: Experimental Evidence," Economic Journal, Royal Economic Society, vol. 102(414), pages 1149-61, September.
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