Deterring Extraction from the Commons : Evidence from an Experiment

Resource management programs use monitoring and sanctioning mechanisms to enforce quota regimes governing harvest from common pool resources. The existing literature provides mixed evidence regarding the effectiveness of deterrence in strategic choice environments. In a controlled laboratory experiment, this paper varies deterrence parameters, while keeping expected penalties constant, to test the effects of enforcement under four quota regimes governing harvest from a shared resource. Controlling for individual risk attitudes, the main findings from the experiment are that (i) monitoring and sanction mechanisms reduce socially detrimental harvest, (ii) a higher probability of monitoring is more effective than an equivalent increase in the severity of sanctions, (iii) a combination of fines and rewards is more effective than fines alone in reducing socially detrimental harvest in all deterrence parameter combinations, and (iv) monitoring and sanctions are more effective on free-riders than on conditional or unconditional cooperators