Threshold ambiguity and sustainable resource management: A lab experiment

Katharina Hembach-Stunden, Tobias Vorlaufer and Stefanie Engel

Ecological Economics, 2024, vol. 226, issue C

Abstract: Overexploitation of ecosystems can cause drastic shifts to unfavourable states once ecosystems reach critical thresholds. Experimental studies have shown that the knowledge of such thresholds helps to foster sustainable resource management. However, warning resource users of a regime shift is difficult since knowledge about critical thresholds is often associated with considerable ambiguity. We conducted a continuous-time common pool resource lab experiment (N = 360; 90 groups of four participants) to assess how different levels of ambiguous information regarding the location of thresholds affect cooperation amongst resource users. Results show that groups informed only of the threshold's existence cooperate similarly to those provided with a range for the threshold, indicating that ambiguity levels do not significantly influence cooperation amongst resource users for sustaining resources at optimal levels. In addition, we analysed treatment differences once the ambiguity about the threshold location is resolved. We do not find lasting impacts of different ambiguity levels on the likelihood of avoiding crossing the threshold once the threshold location is communicated with certainty. Overall, our results suggest that the scope of providing imprecise threshold information which reduces the level of ambiguity may be limited in fostering more sustainable natural resource management.

Keywords: Environmental uncertainty; Ambiguity; Threshold; Common pool resource; Economic experiment; Cooperation; Coordination (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolec:v:226:y:2024:i:c:s0921800924002507

DOI: 10.1016/j.ecolecon.2024.108353

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