Non-parametric tests of behavior in the commons

B-Tier
Journal: Journal of Economic Behavior and Organization
Year: 2024
Volume: 224
Issue: C
Pages: 521-536

Authors (4)

Banzhaf, H. Spencer (National Bureau of Economic Re...) Liu, Yaqin (not in RePEc) Smith, Martin D. (not in RePEc) Asche, Frank (not in RePEc)

Score contribution per author:

0.503 = (α=2.01 / 4 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Commons problems present behavioral dilemmas, with tensions between individual and collective rationality. When users of a common-pool resource are not effectively excluded, the collective behavior of individuals pursuing their self-interests dissipates economic surplus. We derive a non-parametric test of whether individuals' collective behavior in resource extraction is consistent with the canonical commons model, namely Nash tragedy-of-the-commons behavior. Our approach allows for an arbitrarily concave, differentiable production function of total inputs and for heterogeneous agents with arbitrarily convex, differentiable costs of supplying inputs. We extend the test to allow for unobserved total output. We also define distance from the data to the model and develop statistical tests using the distance metric. Applying our approach to panel data of Norwegian commercial fishing vessels, we find the results of our test are consistent with the economic intuition that, in the absence of property rights, tragedy-of-the-commons behavior dissipates surplus. Significantly, we find property rights reforms move firms away from Nash tragedy-of-the-commons behavior.

Technical Details

RePEc Handle
repec:eee:jeborg:v:224:y:2024:i:c:p:521-536
Journal Field
Theory
Author Count
4
Added to Database
2026-01-24