Experimental Economics

, Volume 17, Issue 4, pp 649–672 | Cite as

Time and uncertainty in resource dilemmas: equilibrium solutions and experimental results

  • Anabela Botelho
  • Ariel Dinar
  • Lígia M. Costa Pinto
  • Amnon Rapoport
Original Paper

Abstract

Most common pool resource (CPR) dilemmas share two features: they evolve over time and they are managed under environmental uncertainties. We propose a stylized dynamic model that integrates these two dimensions. A distinguishing feature of our model is that the duration of the game is determined endogenously by the users’ collective decisions. In the proposed model, if the resource stock level below which the irreversible event occurs is known in advance, then the optimal resource use coincides with a unique symmetric equilibrium that guarantees survival of the resource. As the uncertainty about the threshold level increases, resource use increases if users adopt decision strategies that quickly deplete the resource stock, but decreases if they adopt path strategies guaranteeing that the unknown threshold level is never exceeded. We show that under relatively high uncertainty about resource size, CPR users frequently implement decision strategies that terminate the game immediately. When this uncertainty is reduced, they maintain a positive resource level for longer durations.

Keywords

Common pool resources Social dilemmas Uncertainty Sustainability 

Supplementary material

10683_2013_9388_MOESM1_ESM.pdf (481 kb)
(PDF 481 kB)

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Copyright information

© Economic Science Association 2014

Authors and Affiliations

  • Anabela Botelho
    • 1
  • Ariel Dinar
    • 2
  • Lígia M. Costa Pinto
    • 1
  • Amnon Rapoport
    • 3
  1. 1.University of Minho and NIMABragaPortugal
  2. 2.Water Science and Policy Center, Department of Environmental SciencesUniversity of CaliforniaRiversideUSA
  3. 3.A. Gary Anderson School of Business AdministrationUniversity of CaliforniaRiversideUSA

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