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Commons as insurance: safety nets or poverty traps?




Common property resources are often used by households of developing countries as insurance in case of economic stress. The aim of this paper is to consider the potential poverty-trap implications of this use. If the capacity of the resource is low, or if the population in need of insurance is too large, the households are trapped in CPR extraction activity and cannot get more than their subsistence requirement. In this context, cooperation between households and the introduction of a cooperative insurance mechanism may sustain an equilibrium outside the poverty trap and relax pressure on the resource. Moreover, private insurance schemes could also be a potential solution to this poverty trap.

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  • Delacote, Philippe, 2009. "Commons as insurance: safety nets or poverty traps?," Environment and Development Economics, Cambridge University Press, vol. 14(03), pages 305-322, June.
  • Handle: RePEc:cup:endeec:v:14:y:2009:i:03:p:305-322_00

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    References listed on IDEAS

    1. Ian Walker & Max Velasquez & Fidel Ordoñez & Florencia Rodriguez, 1997. "Regulation, Organization and Incentives: The Political Economy of Potable Water Services in Honduras," Research Department Publications 3013, Inter-American Development Bank, Research Department.
    2. Strand, Jon & Walker, Ian, 2005. "Water markets and demand in Central American cities," Environment and Development Economics, Cambridge University Press, vol. 10(03), pages 313-335, June.
    3. Kevin J. Boyle & P. Joan Poor & Laura O. Taylor, 1999. "Estimating the Demand for Protecting Freshwater Lakes from Eutrophication," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(5), pages 1118-1122.
    4. Jon Strand & Mette Vågnes, 2001. "The relationship between property values and railroad proximity: a study based on hedonic prices and real estate brokers' appraisals," Transportation, Springer, vol. 28(2), pages 137-156, May.
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    1. Jean-Michel Salles, 2011. "Valuing biodiversity and ecosystem services: why linking economic values with Nature?," Working Papers 11-24, LAMETA, Universtiy of Montpellier, revised Dec 2011.
    2. Nielsen, Martin Reinhardt & Pouliot, Mariève & Kim Bakkegaard, Riyong, 2012. "Combining income and assets measures to include the transitory nature of poverty in assessments of forest dependence: Evidence from the Democratic Republic of Congo," Ecological Economics, Elsevier, vol. 78(C), pages 37-46.

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