McAfee, R. Preston and Miller, Alan (2010): The Tradeoff of the Commons.
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We develop a model of scarce, renewable resources to study the commons problem. We show that, contrary to conventional wisdom, property rights can often be less efficient than a commons. In particular, we study two effects: (1) waste which arises when individuals expend resources to use a resource unavailable due to congestion and (2) the risk of underutilization of the resource. We provide necessary and sufficient conditions for each effect to dominate the other when the cost of determining the availability of a resource is low.
|Item Type:||MPRA Paper|
|Original Title:||The Tradeoff of the Commons|
|Keywords:||Tragedy of the Commons; Spectrum; Open Access; Appointments; Property Rights; Reservations|
|Subjects:||D - Microeconomics > D2 - Production and Organizations > D23 - Organizational Behavior; Transaction Costs; Property Rights
K - Law and Economics > K2 - Regulation and Business Law > K23 - Regulated Industries and Administrative Law
D - Microeconomics > D4 - Market Structure and Pricing > D45 - Rationing; Licensing
|Depositing User:||Alan Miller|
|Date Deposited:||10. Nov 2010 01:09|
|Last Modified:||15. Feb 2013 19:30|
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The Tradeoff of the Commons. (deposited 06. Nov 2010 20:22)
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