Friday, 11 June 2010

Information makes the difference

From the ever fascinating comes this bit of research on what a difference information makes:

In his famous 1968 article in the journal Science, Garrett Hardin illustrated his notion of the “tragedy of the commons” by suggesting, “Picture a pasture open to all. It is to be expected that each herdsman will try to keep as many cattle as possible on the commons. But of course, argues Hardin, all other herdsmen will have the same goal. The result is overgrazing which destroys the nurturing pasture and starves all the cows. “Therein is the tragedy,” asserts Hardin. “Freedom in a commons brings ruin to all.” Only centuries of “tribal wars, poaching, and disease” kept the tragedy at bay.

Hardin’s tragedy is based on the logic of ruin embodied in the game theory concept of a prisoner’s dilemma. In prisoner’s dilemma two prisoners are questioned separately and if neither confesses then both will go free. However, if one confesses, he will receive a lesser sentence than the other who remains silent. If both confess, then both are severely punished. The prisoners’ optimal strategy is to remain silent and both go free. However, not knowing what the other will do, the best individual strategy is to confess, which results in the worst outcome, punishment for both prisoners.

Hardin overlooked the fact that herdsmen are not like isolated prisoners; they can talk to each other. And as economics Nobelist Elinor Ostrom and her colleagues make clear in a recent Science article, “Lab Experiments for the Study of Social-Ecological Systems,” talking makes a big difference.

More like a huge difference. By testing various game-playing scenarios using punishment, communication and a mixture of communication and punishment, researchers found that communicating and having a credible punishment to avoid "free riders", everybody wins and "over-harvesting" is avoided.

Empirical research seems to support the libertarian belief that when the government gets the fuck out of everyone's way, everyone is better off and people don't take the piss.

So, governments all around the world: get the fuck out of everyone's way.



TDK said...

Your average socialist claims that the state will wither away and leave a mankind who voluntarily cooperate to share the commons. No private property is necessary.

It appears to me, leaving aside the question of whether socialists act in good faith (ie rhetoric about state's withering away versus actual demands to increase the size and power of the state), that they would argue that this is an argument for them.

View from the Solent said...

Oh boy, here we go again ; “tragedy of the commons”. Invented in 1968 by Garret Hardin (Science 162: 1243-8).
Commons were not open to all. A small number of people – the Commoners – had carefully defined, and strictly controlled rights in common, such as pasturage (grazing), piscary (fishing), estovers (woodcutting), etc. etc.
They were strictly guarded by the Commoners themselves. If, for example, a Commoner grazed too many animals or a non-Commoner tried to graze animals, they were liable to wake up and find that those surplus animals had had their throats cut. If they were unlucky it would be their own throats. More formally, disputes among Commoners were resolved by the landowner (Lord of the Manor, typically) presiding at a Court of Commons Law . From whence grew our Common Law.

Amongst others too numerous to mention - The Question of the Commons, Townsend & Wilson, 1987; Governing the Commons, Ostrom, 1990; et al

Morlock said...

Quite right.

And I must point out that Hardin's weak piece -- the title of which has passed into economic folklore -- is forever misused by propertarians of one ilk or another. For a good two-piece rebuttal of Hardin, albeit from a Marxist (try to read with an open mind!), look here and here.

Tim Worstall said...

Well, yes and no.

Olstrom's research does show (as Hardin himself admitted decades ago) that consensual and voluntary communal management can work.

Don't forget, Hardin's point wasn't that this couldn't work: only that there had to be some form of management.

However, Olstrom's work also shows that above a few hundred (and certainly above a few thousand) then such voluntary and communal systems do not work.

Minchinhampton Common (one of he few commons I know of that is still a Common) still works nicely with a few tens of people with access to it.

When the entire population of Manchester decides to go to Kinder Scout, less so.

In short: size matters.

Shug Niggurath said...

You know how socialists really just don't believe people are any good?

Seems to be their idea that in a free society there will be people abusing their freedom and so (for the good of society) we need to act as a herd.

Which is a lot different from us forming an acceptable code of, um, hate the phrase, but 'honour'.

What socialists seem unable to see is that once the state gets up and running it's needs then must always come first. Demonstrated in various ways like PAYE, where 'as' really means before, VAT, Council Tax bills in advance and so on.

Occasionally they seem to see the light when the state gets personal with them, but overall they simply seem to believe that people are fundamentally harmful to other people and need to be reigned in as much as possible.

Yes. Ok. Socialists are all a bunch of cunts.

Anonymous said...

I think it would depend on the situation and on how good the information is. For example, over fishing would be nearly impossible to self police, as you'd need total satellite coverage to somehow count all the fish, so that we'd know the starting point. Plus it would be difficult to set quotas without some central organisation. Government has failed even with the quota system, but it's hard to imagine an alternative.

marksany said...

this shows two ways to solve the tragedy of the commons archetype. 1) as you say, feed information back to the participants or 2) put a person in charge of controlling access to the common resource. The notes on the pros and cons are interesting

J Demetriou said...

This is very good. Nicely researched.

John R said...

There are some good examples of fishing grounds off various countries that have been fished into near-extinction due to "the tragedy of the commons". Several of these have now been restored to former stocking levels by changing the access rules not be limiting days/catches etc in a "hardwired" fashion

The most effective way is to make the licensed fishermen shareholders in the fishing ground and to allow each boat a percentage of the total catch. What they all soon realise is that they need to grow the total take if they each want to catch the same sized slice but of a larger pie. Very rapidly behaviours achange

So I think Obo is half right - the state needs to get out of the actual setting of the targets but does need to set the legal framework within which the market operates.