Tuesday, October 13, 2009

Elinor Ostrom presents her analysis of the commons

Elinor Ostrom won the Nobel prize in economics yesterday (along with Oliver Williamson). Here is a video by Prof. Ostrom explaining her take on the commons.


David Karp said...

Is this Ostrom's main contribution to economics? It doesn't strike me as that novel. She's basically saying that local, informal governments can be more effective than large formal state institutions in developing solutions to common pool resource problems, which doesn't seem to be that earthshattering of an idea.

She also doesn't really get into the mechanism of why such systems would work, because it seems to me that people would have an incentive to cheat and overharvest. Is it because common pool resource problems are better modeled as repeated games than one-shot games? Or is altruism over future generations the mechanism that makes this work? Peer pressure perhaps? Or perhaps people are not rational in the profit-maximizing sense?

I'm guessing there has to be something more to her work than just this.

J. Fugle said...

David: Good guess. Perhaps your grasp of your own lack of knowledge on the topic will serve you well as you narrate your musings online for all. Maybe, even, you will be inspired to do a little looking around for examples of her work being discussed on the internet beyond an 8 minute video.