Distributing the Benefits From the Commons: Square-Root Formula
How should the benefits of the commons, say a publicly owned fishing resource, be distributed? A first possibility is equal division among the population. A second option is to distribute them among the people who actually exploit the resource in proportion to their activity level: this is the ""land to the tiller"" view. A third approach is the nusufruct"" view, by which a consumer of the fruits of the commons ends up contributing the average cost, whithout generating incomes for nonconsumers. The usufruct and ""land to the tiller"" views are polar opposites. One could consider intermediate positions where a fraction 0 of the benefits is distributed among consumers in proportion to their consumption, and the fraction 1-0 is distributed among fishers in proportion to their fishing effort. The paper singles out a particular value for 0 based on equalizing the ""rate of return,"" defined as follows. Consumers are the direct users of the fruits of the resource: they contribute numeraire (transferred to the fishers) and obtain fish in return. A fisher contributes time and obtains numeraire in return. It turns out that, if the ""return ratios"" are equalized across persons, fishers and consumers alike, then a particular value of 0 results, namely:
|Date of creation:||07 Jul 2004|
|Contact details of provider:|| Postal: One Shields Ave., Davis, CA 95616-8578|
Phone: (530) 752-0741
Fax: (530) 752-9382
Web page: http://www.econ.ucdavis.edu
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Roemer John E. & Silvestre Joaquim, 1993. "The Proportional Solution for Economies with Both Private and Public Ownership," Journal of Economic Theory, Elsevier, vol. 59(2), pages 426-444, April.
- Joaquin Silvestre, 1994. "Economic analysis of public ownership," Investigaciones Economicas, Fundación SEPI, vol. 18(1), pages 19-66, January.
When requesting a correction, please mention this item's handle: RePEc:cda:wpaper:95-6. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Scott Dyer)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.