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Social Capital as an Instrument for Common Pool Resource Management:A Case Study of Irrigation Management in Sri Lanka

  • Aida, Takeshi
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    This paper investigates the effect of social capital between irrigation canal head-enders and tail-enders on their water allocation problem. Although social capital is considered to be an instrument for common pool resource management, a consensus has not been reached on its effect among heterogeneous players. In irrigation management, the water allocation problem between head-enders and tail-enders is one of these serious problems. Using unique natural and artefactual field experiment data as well as general household survey data collected by JICA, this study finds that social capital, especially trust toward their tail-enders, has a significantly positive effect on satisfaction with water usage among head-enders. Considering the fact that the incentive structure of irrigation water allocation for head-enders closely resembles that in the dictator and trust games, this finding also supports the validity of experimentally measured social capital. In addition, this study deals with the simultaneity bias between satisfaction level and experimentally measured social capital, and finds that OLS estimators are downward biased, which is consistent with the hypothesis that scarcity of resources enhances the level of social capital.

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    File URL: http://hdl.handle.net/10685/59
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    File URL: http://repository.ri.jica.go.jp/dspace/bitstream/10685/59/1/JICA-RI_WP_No.33_2011_2.pdf
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    Paper provided by JICA Research Institute in its series Working Papers with number 33.

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    Date of creation: 09 Aug 2011
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    Handle: RePEc:jic:wpaper:33
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    1. Masako Fujiie & Yujiro Hayami & Masao Kikuchi, 2005. "The conditions of collective action for local commons management: the case of irrigation in the Philippines," Agricultural Economics, International Association of Agricultural Economists, vol. 33(2), pages 179-189, 09.
    2. Yujiro Hayami, 2009. "Social Capital, Human Capital and the Community Mechanism: Toward a Conceptual Framework for Economists," Journal of Development Studies, Taylor & Francis Journals, vol. 45(1), pages 96-123.
    3. Cox, James C., 2004. "How to identify trust and reciprocity," Games and Economic Behavior, Elsevier, vol. 46(2), pages 260-281, February.
    4. 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.
    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. Marcel Fafchamps, 2005. "Development and Social Capital," Economics Series Working Papers GPRG-WPS-007, University of Oxford, Department of Economics.
    7. Juan Camilo Cardenas & Jeffrey Carpenter, 2008. "Behavioural Development Economics: Lessons from Field Labs in the Developing World," Journal of Development Studies, Taylor & Francis Journals, vol. 44(3), pages 311-338.
    8. Juan Camilo Cárdenas & Luz Ángela Rodríguez & Nancy Johnson, 2009. "Collective Action forWatershed Management: Field Experiments in Colombia and Kenya," DOCUMENTOS CEDE 006649, UNIVERSIDAD DE LOS ANDES-CEDE.
    9. Yasuyuki Sawada & Ryuji Kasahara & Keitaro Aoyagi & Masahiro Shoji & Mika Ueyama, 2013. "Modes of Collective Action in Village Economies: Evidence from Natural and Artefactual Field Experiments in a Developing Country," Asian Development Review, MIT Press, vol. 30(1), pages 31-51, March.
    10. Juan Cardenas, 2011. "Social Norms and Behavior in the Local Commons as Seen Through the Lens of Field Experiments," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 48(3), pages 451-485, March.
    11. Laura Schechter, 2005. "Traditional trust measurement and the risk confound: An experiment in rural paraguay," Artefactual Field Experiments 00106, The Field Experiments Website.
    12. Dean S. Karlan, 2005. "Using Experimental Economics to Measure Social Capital And Predict Financial Decisions," Working Papers 909, Economic Growth Center, Yale University.
    13. Shoji, Masahiro & Aoyagi, Keitaro & Kasahara, Ryuji & Sawada, Yasuyuki, 2010. "Motives behind Community Participation," Working Papers 16, JICA Research Institute.
    14. Holt, Charles A. & Johnson, Cathleen & Mallow, Courtney & Sullivan, Sean P., 2010. "Tragedy of the common canal," MPRA Paper 20838, University Library of Munich, Germany.
    15. Sawada, Yasuyuki & Shoji, Masahiro & Sugawara, Shinya & Shinkai, Naoko, 2009. "The Role of Infrastructure in Mitigating Poverty Dynamics: The Case of an Irrigation Project in Sri Lanka," 2009 Conference, August 16-22, 2009, Beijing, China 51461, International Association of Agricultural Economists.
    16. Abigail Barr & Pieter Serneels, 2009. "Reciprocity in the workplace," Experimental Economics, Springer, vol. 12(1), pages 99-112, March.
    17. Abigail Barr, 2003. "Trust and expected trustworthiness: experimental evidence from zimbabwean villages," Economic Journal, Royal Economic Society, vol. 113(489), pages 614-630, 07.
    18. Dean S. Karlan, 2005. "Using Experimental Economics to Measure Social Capital and Predict Financial Decisions," American Economic Review, American Economic Association, vol. 95(5), pages 1688-1699, December.
    19. Bouma, Jetske & Bulte, Erwin & van Soest, Daan, 2008. "Trust and cooperation: Social capital and community resource management," Journal of Environmental Economics and Management, Elsevier, vol. 56(2), pages 155-166, September.
    20. Elinor Ostrom & Roy Gardner, 1993. "Coping with Asymmetries in the Commons: Self-Governing Irrigation Systems Can Work," Journal of Economic Perspectives, American Economic Association, vol. 7(4), pages 93-112, Fall.
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