| Management and cooperation among users of natural resources such as extensive grazing lands, forests, and international fisheries are often characterized by free mobility of agents, i.e. production technologies spread across multiple locations. This work is motivated by the pastureland use practiced in Mongolia and presents insight on how free mobility of agents may affect resource management. We extend the research on the management of common-pool resource (CPR) to multiple communities where agents are free to choose their locality in which to extract resource. Here, we study the effects of the various institutions on the spatial distribution of agents in a two-locality economy. Our work focuses on two differing institutions: no regulation and sanctioning system previously studied in Casari and Plott (2003). When individuals are free to choose between two localities with and without sanctions, we ask whether a community with a sanctioning system can withstand the migratory pressure from outside. This study is comprised of both theoretical and experimental inquiry. It is organized in three chapters. Chapter 1 provides a theoretical model and characterizes the free mobility equilibrium using the notion of Tiebout equilibrium. We find that a decentralized management of CPR may sustain resource efficiency at a high level if the sanctioning system adjusts to the migration from the neighboring locality without sanctions. Moreover, a positive externality is captured by the neighboring unregulated locality. Chapter 2 was designed to test the prediction of the model using laboratory computerized experiments in the USA and Mongolia. The experimental data suggests that sanctioning is an effective tool in preventing free riding in a CPR setting even under free mobility. Partial monitoring was sufficient to reduce over-extraction. In addition, we observed interesting behavioral factors such as sorting of the population into different regimes and predation among participants in the unregulated locality. Chapter 3 provides methodological discussion on the differences between hand-run and computerized experiments using the data from both types of experiments conducted in Mongolia. Results in both settings are in line with theoretical predictions, yet the influence of social values is more obvious in the hand-run experiments. |
