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  • Kaivanto(2018)IJC12(1)LotteryAllocationOfFishingSites_final_published

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Community-level natural resource management institutions: A noncooperative equilibrium example

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Published
<mark>Journal publication date</mark>23/04/2018
<mark>Journal</mark>International Journal of the Commons
Issue number1
Volume12
Number of pages25
Pages (from-to)548-572
Publication StatusPublished
<mark>Original language</mark>English

Abstract

The Institutional Analysis and Development (IAD) literature finds that Nash equilibrium predictions are empirically falsified in the social dilemmas that arise in community-level natural resource management problems. However, Nash equilibrium is not the only solution concept within noncooperative game theory. Here we demonstrate the power of Correlated Equilibrium (CE) to explain lotteries for the allocation of fishing sites as enduring community-level natural resource management institutions. Such CE-implementing lotteries are procedurally fair, equitable, and increase total expected fishery value.This modeling approach clarifies two further sets of relationships. It reveals the nature of the interdependence between the size and spacing of fishing sites and (a) the in-use characteristics of fishing gear, as well as (b) the degree of formalization of property rights and the structural features of the natural resource-management institution. When appropriately applied, noncooperative game theory offers a powerful explanatory complement to the IAD literature on community-level natural resource management.