WDW101Y1 Lecture 5: Lecture 5-6
2 Feb 2018
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In small groups rational actors can be coaxed to cooperate through concerns about: reputation, reciprocity, punishment. Public goods: a resource that is available to all; no one person or organization owns (ex. A light house, clean air, military, clean fisheries, highways) Free rider: someone who uses a public book without contributing. How do we get rational actors to cooperate: transparency. Discuss objectives and develop clear rules: trust-building. Shaking hands, transparency, reciprocity: moral pressure/shaming. Defectors will be called out: punishment. Fines; imprisonment; thrown off the island: redistribute wealth. Cheaters will be fined and money goes to the poor: an authority ( hierarchy ) to make and enforce rules (an organization) How can we get people in large complex societies to cooperate: hardin: reduce consumption (new order) Selterman: punishments/incentives; shaming; social norms: stoessel: privatize public goods, ostrom: small, local organizations with clear rules, monitors, and a system of graduated punishments for rule-breakers.
