The Dynamic Efficiency Costs of Common-Pool Resource Exploitation

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The Dynamic Efficiency Costs of Common-Pool Resource Exploitation

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by Huang , Martin D. Smith , Jel C , Han Hong , All A. Kramer , V. Joseph Hotz , Victor Aguirregabiria , Haifeng Huang , Kerry Smith , Jason R. Blevins , Sathya Gopalakrishnan , Zachary Brown , Junjie Zhang , David Layton , Dale Squires , Jim Wilen , Frank Asche , Two Anonymous

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2 - 1 self

BibTeX

@MISC{Huang_thedynamic,
    author = {Huang and Martin D. Smith and Jel C and Han Hong and All A. Kramer and V. Joseph Hotz and Victor Aguirregabiria and Haifeng Huang and Kerry Smith and Jason R. Blevins and Sathya Gopalakrishnan and Zachary Brown and Junjie Zhang and David Layton and Dale Squires and Jim Wilen and Frank Asche and Two Anonymous},
    title = {The Dynamic Efficiency Costs of Common-Pool Resource Exploitation},
    year = {}
}

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Abstract

We conduct the first empirical investigation of common-pool resource users ’ dynamic and strategic behavior at the micro level using real-world data. Fishermen’s strategies in a fully dynamic game account for latent resource dynamics and other players ’ actions, revealing the profit structure of the fishery. We compare the fishermen’s actual and socially optimal exploitation paths under a time-specific vessel alloca-tion policy and find a sizable dynamic externality. Individual fishermen respond to other users by exerting effort above the optimal level early in the season. Congestion is costly instantaneously but is beneficial in the long run because it partially offsets dynamic inefficiencies.

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