Open Access Open Access  Restricted Access Subscription or Fee Access

On Overexploitation and Incentive Mechanisms: Congestion vs Non Exclusion

Daniel FUENTES CASTRO, Pierre-Alain JAYET

Abstract


We consider the case of commons in the presence of congestion. Excluding the least efficient agents is often proposed with the argument that they are not capable of obtaining the same added value as the most efficient agents can. In this paper we show why free access to commons by the most efficient agents does not guarantee the maximization of social welfare. We also show under which conditions it is possible to maximize social welfare avoiding the exclusion of the least efficient agents. Finally, we analyze how asymmetric information distorts first-best allocation, redistributing the resource in favor of the most efficient agents, and why those with extreme types (the most and the least efficient agents) are the ones with less incentive to cooperate.

Keywords


Commons; Congestion; Asymmetric Information; Adverse Selection; Environment; Natural Resources; Incentives

Full Text:

PDF


Disclaimer/Regarding indexing issue:

We have provided the online access of all issues and papers to the indexing agencies (as given on journal web site). It’s depend on indexing agencies when, how and what manner they can index or not. Hence, we like to inform that on the basis of earlier indexing, we can’t predict the today or future indexing policy of third party (i.e. indexing agencies) as they have right to discontinue any journal at any time without prior information to the journal. So, please neither sends any question nor expects any answer from us on the behalf of third party i.e. indexing agencies.Hence, we will not issue any certificate or letter for indexing issue. Our role is just to provide the online access to them. So we do properly this and one can visit indexing agencies website to get the authentic information.