Governing the commons on an Aegean island: the management of water resources on Sifnos, Greece

Abstract

s 1968 article in Science on the 'tragedy of the commons' (Hardin 1968) popularised how a scarce resource may be eventually depleted if it belongs to no one in particular ('a pasture open to all'). The over-exploitation of cod stocks in the North Atlantic from the mid-1950s, causing their virtual disappearance in the early 1990s, and the resulting death of the fishing industry which had sustained the livelihoods of the United States and Canadian fishing communities for 300 years, is merely one example. (See also Fehr and Leibbrandt 2011.) The original response to the Tragedy of the Commons was to view it as a problem of poorly defined property rights (Coase 1960). When a resource is collectively owned, and access is unrestricted, individual users pursuing their short-term self-interest end up harming the community's long-term collective interest. By seeing the problem as stemming from the poor definition of property rights, two alternative solutions arose: (1) public ownership and regulation, whereby the government sets and enforces limits (via quotas, penalties, access rights, and so on); or (2) conversion to private property, that is, privatisation of the common resource, providing the incentive to the (single) owner to eliminate excess use in order to maximise profit. The two solutions can be shown to yield identical results in terms of the elimination of excess use, though of course they may differ greatly in terms of their distributional implications.Elinor Ostrom's book Governing the Commons: The Evolution of Institutions for Collective Action (Ostrom 1990), which won her the 2009 Nobel Prize in Economics, established a third solution. Reviewing a great variety of historical examples, she demonstrated that small and stable communities have long been able to devise creative, effective and resilient local systems of rationing access