Managing a Common Renewable Resource in Asymmetric Information

D. Fuentes Catro, Pierre-Alain Jayet and Gilles Rotillon
Authors registered in the RePEc Author Service: Daniel Fuentes Castro

No 24893, 2002 International Congress, August 28-31, 2002, Zaragoza, Spain from European Association of Agricultural Economists

Abstract: The clear definition of property rights is not a sufficient condition to prevent congestion effects in commons. In this paper we present how interesting can be the coordination among owners in the preservation of the common good. Our approach takes into account economic dynamics and incentive mechanisms in a hidden information context. We consider a natural resource which is being used up for a continuum of producers on a common property regime. We also consider that each producer has an individual performance index which is a hidden information of the rest of players. We introduce coordination in the sense of a global maximization of the joint profit. If there is no coordination among the producers, their behavior leads to complete rent dissipation. We focus our model in the case of the producers convinced to coordinate their actions in order to preserve their own economic sustainability. Under perfect information we find that the exclusion of at subset of producers can appear and how it is endogenously determined. Under asymmetric information we propose a quantity-transfer contract which lead us to the previous stationary disposal stock of the resource without exclusion.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 16
Date: 2000
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Managing a common renewable resource in asymetric information (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaae02:24893

DOI: 10.22004/ag.econ.24893

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