Effects of Threshold Uncertainty on Common-Pool Resources

Many natural resources and common-pool resources have inherent thresholds regarding the onset of deleterious environmental impacts or consequences. Group and individual behavior were examined in an experimental setting using three distinct games designed to model common-pools in which there existed such a threshold: one with complete information of the threshold, one with incomplete information of the threshold and one with sporadically enforced targets. By design the true threshold was unknown to the players in the role of policymaker, and the guesses of the threshold value were allowed to change during every round. Sporadically enforced targets had a significant negative effect on the lifespan of a common-pool resource and individual gains. Allowing the participants to develop and act on their own beliefs for the location of the threshold improved both individual benefit and conservation of the common-pool. Conservation of common-pool resources will be best achieved by policies which allow users of the resource access to reliable information regarding the status of the common-pool and which enable the development of their own beliefs regarding the location of threshold.