CONFLICT AND COOPERATION IN
UTILIZING A COMMON PROPERTY RESOURCE

NIR BECKER AND K. WILLIAM EASTER

Abstract:

Noncooperative games are used to demonstrate that, while free riding is always an option, the ``tragedy of the commons'' is not inevitable. When the decision to cooperate or free ride is considered in a dynamic setting, there is no intermediate case where some cooperate and others free ride. The game is only stabilized in either full cooperation or full defection. The important factor in obtaining a cooperative outcome is the critical number of players that decide to cooperate. The concept of commitment is used to demonstrate the necessary and sufficient conditions for full cooperation. Although the analysis is based on a shared water resource, it can be extended to other natural resources with common costs and private benefits, especially in the cases where there are no international authorities or treaties that internalize the externalities involved in privatizing the resource.