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Second best – better in the long run
Creating strong cooperatives might be more important than fishing at the most sustainable level, new study suggests
- Maintaining socially optimal use of a common-pool resource, such as a fishery, is possible only if the social punishment is strong enough against those who do not cooperate.
- When this is not possible, it is often wiser to let the cooperative over-harvest to some extent and focus on the robustness against selfish harvesters depleting the resource.
- This highlights the value of pragmatism in natural resource management.
Without effective management, our shared resources such as oceans, forests and the atmosphere are often overexploited. This phenomenon is known as the “Tragedy of the Commons” where individual users act in self-interest and harvest as much as they can – in the end leading to decreased well-being for all. However, as Nobel Laureate Elinor Ostrom has shown, this tragedy can be avoided when people depending on a natural resource cooperate and create common rules.
How such cooperatives work and how shared resources can be managed are still important research topics within sustainability science. Centre researcher James Watson together with Andrew Tilman and professor Simon Levin from Princeton University now present a study further exploring the mechanisms of cooperation. Simon Levin is also a member of the Stockholm Resilience Centre board.
What promotes collaboration?
The study, which is published in the journal Theoretical Ecology, is based on the example of fisheries lacking effective top-down regulation. Such small scale fisheries employ some 37 million people world-wide, particularly in low income countries.
Therefore, James Watson explains, “improved management in these fisheries can have substantial positive impacts on human welfare, since in these regions there is often a greater reliance on fish for dietary protein”.
Through a mathematical modelling approach, the researchers investigate how the threat of exclusion from the group, social ostracism, can promote cooperation. But this kind of social punishment is not always strong enough.
Unfortunately, the long-term sustainable use of a resource is not assured even if cooperation, maintained by ostracism and aimed at optimizing resource use, exists
James Watson, co-author
A balance between the optimal and the realistic
The study shows that if the cooperative of fishermen fishes in the most sustainable manner, the result can ironically be worse than if they overharvest to some extent. Fishing at sustainable levels, where the fishers collective profit will be maximized, is called the social optimum.
This “first-best strategy” will improve the state of the fish stocks as well as the collective profits and the wellbeing – but at the same time there are still incentives for individuals to break the rules, leave the cooperative and fish as much as they can individually.
The more fishers that belong to the cooperative, the stronger the effects of social ostracism and punishment will be.
Through a set of equations Watson and colleagues identify the equilibria where most fishers will find it worthwhile to be part of the cooperative.
For a cooperative to be maintained, they find that it is often wiser to choose a “second-best strategy” where the cooperative actually over-fish to some degree. This strategy emphasizes the benefits of cooperation, decreases the incentives to overharvest individually, and so increases the resistance to invasion by independent harvesters.
James Watson concludes that “in the long-run, when resource users employ a second best harvesting strategy, they will be better off, and so will the resource”.
The researchers used small scale fisheries as a model case study to investigate the conditions necessary for the long-term persistence of sustainable cooperation around a shared resource. A modelling framework was developed and the researchers used a game-theoretic approach, where fishers shift towards strategies that give higher individual utility, taking into account economic payoffs as well as social and economic costs of both norm violation and enforcement.
Tilman, A., Watson, J., Levin, S. 2016. Maintaining cooperation in social-ecological systems: Effective bottom-up management often requires sub-optimal resource use. Theoretical Ecology, DOI 10.1007/s12080-016-0318-8
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