1. 2022-sustainability-strategic-innovation-and-change-summary (gesleept).pdf

lOMoARcPSD|11364796 Learning Module 3: The Tragedy of the Commons A nuclear war as well as many other problems have no technical solutions. According to the paper there are many “No Technical Solution Problems”, such as the population problem or winning t...

lOMoARcPSD|11364796 Learning Module 3: The Tragedy of the Commons A nuclear war as well as many other problems have no technical solutions. According to the paper there are many “No Technical Solution Problems”, such as the population problem or winning tick-tack-toe. Resources on the planet are finite, hence the world is finite and can only support a finite population. The Tragedy of the commons: picture a pasture open for all, it is expected that each herdsman will keep as many cattle’s as possible on the commons. Ones the capacity of the pasture has reached 100% adding another cattle will result into one positive component (only for the owner) and a negative component for all herdsman’s using the pasture. Positive: having additional cattle that can be eventually sold = +1 Negative: overgrazing that is created is shared by all herdsman’s = fraction of -1 each herdsman is compelled to increase its herd without limit in a word that is limited! Underlying issue: Individual benefits but shared costs (marginal costs < marginal benefit for the herdsman) 1. What makes something a "common" resource? How can we define it? Toll Good: It is easy to charge for the use of the good while there is also no need to limit the number of users, as one user does not limit another user. E.g. Netflix Private goods: Easy to manage through markets, excludability as well as rivalry are high. The product you use cannot be used by Gedownload door Bart S ([email protected])  lOMoARcPSD|11364796 another person, however you also pay the full price of your consumption. E.g. Popcorn Public Good: Peace is an example: we can all enjoy living in peace without anyone having less peace Common good: Get easily overexploited. It is difficult to exclude any users, but the availability decreases with users consumptions. Resources from whose use other potential demanders cannot be excluded, but the demanders' usage provokes rival among each other. For Pollution its reversed: It is not about taking something out of the commons but rather about putting something in (e.g. pollutants, chemicals, radioactive). However, the calculations remain the same: The rational man finds that his share of the cost of the wastes he discharges into the commons is less than the costs of purifying his wastes before releasing them. Other examples of the problematic use of natural resources to which no exclusive rights of disposal are defined: Overfishing of the world's oceans Depletion of wildlife populations and forests, especially in developing countries (overexploitation) Discharge of wastewater into streams and rivers Pollution of these by agricultural pesticides and overfertilization illegal conversion of forests into arable land (Indonesia, Latin America, Africa) overexploitation of soils resulting in desertification use of the atmosphere as a sink for air pollutants with air pollution consequently. 2. What possible interventions can we use to manage a commons effectively? 1) Privatisation: Individualising benefits and costs. E.g., carbon trading 2) Mutual coercion (adding costs to individual use) Regulations and penalties. E.g. EU passenger car emission standards (enforcement can be challenging e.g. VW scandal) Government levies (taxes, fees, etc.) the costs of using a resource needs to be taxed to the person using the resource. E.g., carbon taxation to internalize the externalities caused by CO2 emissions  lOMoARcPSD|11364796 Problems to the second problem: Allocation challenge Because climate change is a highly complex topic with many variables unknown it is difficult to put them into regulation Cost of levying taxes and enforcing regulations No global government, no authority to intervene difficult international enforcement. E.g., many companies have shifted their production to a country where environmental standards are lower Not even within the EU we managed to agree on the price of emission, hence it is questionable whether humanity is able to solve the tragedy of the commons without the existence of a global government 3) Third Solution by Elinor Ostrom: Beyond the Tragedy of the commons Giving property rights to individuals so that they can make rules for some commons Bottom-up institutions State interventions is not always needed for communities to develop governance approaches for commons management. There are several such polycentricity institutions by now. The sets of rules developed greatly differs from one community to another as each common is unique and this requires its own set of rules. Design principles of such institutions: 1. Boundaries: For the community managing as well as the users need to be established 2. Local Rules: Rules governing the use of common goods need to match local needs and conditions. The rules should ensure proportional equivalence between costs and benefits for each user 3. Participation: Those affected by the rules should be able to participate in modifying the rules 4. Recognition: The room making rights of community member need to be respected by other (state) authorities 5. Monitoring: Assistance need to be developed and carried out by community members to monitor members behaviour 6. Graduate sanction for rule violators need to applied to avoid misuse 7. Conflict resolution: Access and low costs means of dispute resolution need to be established  lOMoARcPSD|11364796 8. Multiple layer: Responsibility for governing the common resource from the lowest level up to the entire interconnected system needs to be developed Problems of the third Solution Bottom-up institutions are highly context dependent: Transferring best practice form one to another is tricky Trust in community is important and crucial to enforce rules Scale issue: Cannot apply globally, as this would require humanity to be a community How to self-govern corporate sustainability behaviours? Are there any approaches to governing emissions through a bottom-up approach?