Common property systems have uncommon results

Sometimes a bad idea, eloquently expressed, has enormous influence. Garrett Hardin’s famous essay, “The Tragedy of the Commons,” demonstrates that truth.

Hardin, a biologist and population ecologist who taught at University of California-Santa Barbara, died last month. Soon after publication of his influential essay 35 years ago, other scholars refuted it. Still, the essay continues to be widely reprinted and cited, while Hardin’s critics continue in academic obscurity.

Hardin stoked the population growth fears of the 1960s and 1970s. While his training was almost entirely in biology, his essay (published in Science magazine in 1968) was mostly an exercise in social science.

He argued that attempting to manage any resource under collective, rather than individual or government ownership, inevitably caused degradation or destruction of the resource. His solution to many resource, population and environmental problems was individual ownership of resources whenever possible combined with coercive government when it was not possible.

The essay was one of the seminal documents of the population movement, reprinted in more than 100 anthologies and translated into numerous other languages. I had to read it in freshman English at the University of Minnesota in 1971 and took it as gospel. Unfortunately, Hardin’s argument was fundamentally flawed. He confused “common property” with “open access resources.”

A quick review may be useful. To economists, private property describes things clearly owned by an individual or firm. Public property refers to government ownership. But not everything is subject to individual ownership. No one has clear title to the atmosphere or to whales or seabed manganese nodules. These are termed “open-access resources” or “free goods.”

There is also a category of resource ownership called “common property.” Properly used, this refers to a resource — a pasture, a village woodlot, a local irrigation system or a fishery — that is owned and managed by some well-defined group such as a village, family or tribe.

In medieval Europe, most farmland was common property. Legal ownership perhaps was vested in some lord, but the local villagers determined who farmed and how cropland and pastures were used on a day-to-day and year-to-year basis. The system persisted into colonial America. The Boston common was a collectively owned and managed pasture.

Common property remains important in some European countries such as Switzerland and Norway, where much grazing land is still owned by villages rather than individuals. It is also important in South America, particularly grazing land in the Andes; in south Asia, where village irrigation works, woodlots and pastures are managed as common property; and in Africa.

Hardin assumed that common property was the same as an open-access resource. He argued that no one controlled the commons and that any villager had an incentive to put additional animals on it. Overstocking hurt commons users as a whole, he argued, but no single individual had an incentive to reduce overgrazing by removing one of her own animals because that individual would bear the cost but all the other users would share in the benefit. The inevitable result would be destruction of the resource.

The basic argument is correct when applied to open-access resources. Passenger pigeons were an open access resource in 19th century America, and the last of these tasty birds were shot over a century ago. Whales were hunted to near extinction, and the North Atlantic cod fishery finally has collapsed.

True common property, however, is sharply different from an open-access resource. No villager is free to put additional animals on the commons at will, or chop additional logs or use additional water. In true common property situations, the village or clan controlling the resource usually has well-designed and enforced rules about who and how the commons gets used.

Resource degradation is not inevitable. Common pastures in Switzerland, Peru, Afghanistan and Lesotho — managed as commons for millennia — are in good shape. So are Japanese village irrigation systems, fisheries and woodlots.

Hardin’s disciples see these objections as mere pedantry. For them, the master was right on the big question — that inadequate incentive systems cause environmental and resource degradation, and any haggling about differences between “open access” and “common property” was inconsequential.

There were consequences, however. Common property systems evolved because in some situations, particularly those involving weather, catch or yield risk, they are economically more efficient than individual ownership. Scholars in history, sociology, anthropology and economics have demonstrated that quite conclusively.

But bureaucrats in developing countries who read Hardin continue imposing individual ownership regimes that make people poorer rather than better off. Common property owners in the Alps or Scandinavia have the political power to preserve an economically efficient institution. Those in the Andes, South Asia or East Africa often do not. They are the victims of a well argued, but bad, idea.

© 2003 Edward Lotterman
Chanarambie Consulting, Inc.