Symmetric Tragedies: Commons and Anticommons

Abstract

An anticommons problem arises when there exist multiple rights to exclude. In a lengthy law review paper, Michael A. Heller has examined ''The Tragedy of the Anticommons,'' especially in regard to disappointing experiences with efforts to shift from socialist to market institutions in Russia. In an early footnote, Heller suggests that a formal economic model of the anticommons has not been developed. This paper responds to Heller's challenge. We analyze the anticommons problem in which resources are inefficiently underutilized rather than overutilized, as in the familiar commons setting. The two problems are shown to be symmetrical in several respects. We present an algebraic and geometric illustration and extend the discussion to several applications. Of greater importance, we suggest that the construction is helpful in understanding the sources of major value wastage in modern regulatory bureaucracy.The navigation of the Danube is of very little use to the different states of Bavaria, Austria, and Hungary, in comparison of what it would be if any of them possessed the whole of its course till it falls into the Black

Substituting Complements

“…This is the case described by Cournot (1838), Ellet (1839) and Buchanan and Yoon (2000), although with different applications. Each individual firm i = 1, 2 sets the price p i for its component, which results in a final total price of the bundle P = Σp i .…”

“…12 In order to provide a simple and easily interpretable answer, we use a linear demand function, as in Buchanan and Yoon (2000), for a good consisting of a bundle of several inputs.…”

“…Analogous to the recently popularized anticommons problem, this framework is a particularly powerful tool for the analysis of issues related to the fragmentation of physical and intellectual property rights. 9 From this perspective, fragmenting a single resource into complementary portions creates the conditions for the complementary oligopoly and anticommons problems formalized in Buchanan and Yoon (2000) and Parisi, Schulz and Depoorter (2005). 10 This result is driven by the fact that when complements are at stake, an increase in the price of a fragment causes a negative externality to the sellers of other complementary goods as the quantity demanded plummets for everyone.…”

Duality in Property: Commons and Anticommons

“…In the present setting, the external effects of the "exclusion" decision generate higher than efficient prices, with a resulting under-utilization of the common resource. In this form, the suggested price-driven model of the anticommons is the general version of the example contemplated by Buchanan and Yoon (2000). 11 but not necessary to derive this result.…”

Small-scale European forestry, an anticommons?

“…Spatial anticommons exist, if each ''owner receives a core bundles of rights, but in too small a space for the most efficient use'' (Heller 1998). In small-scale Buchanan and Yoon (2000) for example, use the tragedy of the anticommons to argue that, in 14 their opinion, environmental legislation gives too many (environmental) actors the possibility to exclude others from use (e.g. block development), therefore blocking the actual use of the resource.…”