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Income sharing for common pool resources with uncertain productivity

Author

Listed:
  • Claudia Kelsall

    (CEE-M - Centre d'Economie de l'Environnement - Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - UM - Université de Montpellier, iDiv - German Centre for Integrative Biodiversity Research)

  • Martin F Quaas

    (iDiv - German Centre for Integrative Biodiversity Research)

  • Nicolas Quérou

    (CEE-M - Centre d'Economie de l'Environnement - Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - UM - Université de Montpellier)

Abstract

We address the interconnected issues of externalities in the use of a natural commonpool resource system and adverse effects of environmental uncertainty on risk-averse resource users. We set up a simple, analytical model, and derive conditions such that insurance by means of an income sharing mechanism mitigates externalities, and hence achieves a socially optimal outcome. For this to materialize, we show that the sharing rule must be sufficiently sensitive to individual contributions, and specifically show that a simple, proportional sharing rule can provide incentives for both, efficient contributions to the income pool and efficient use of the resource system.

Suggested Citation

  • Claudia Kelsall & Martin F Quaas & Nicolas Quérou, 2025. "Income sharing for common pool resources with uncertain productivity," CEE-M Working Papers hal-05126307, CEE-M, Universtiy of Montpellier, CNRS, INRA, Montpellier SupAgro.
  • Handle: RePEc:hal:wpceem:hal-05126307
    Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-05126307v1
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