Should the State regulate the Local Commons? Lessons from Economic Experiments in the Field

Strategies that integrate conservation and development are especially critical in regions where ecosystems provide direct and indirect benefits for local users and others, and where because of institutional conditions there is a commons dilemma. State intervention is sometimes thought necessary and desirable to correct the externalities arising from the conflict between short-term needs to extract a resource from the common-pool and the long-term need for preserving the ecosystem for its renewability and its capacity to provide other indirect ecological services. In this paper we question the assumption that state intervention will always improve what a group of users may achieve through self-governing institutions— even when users do not coordinate their individual actions. State intervention, we will argue, may also generate other unexpected changes in human behavior that may work against the goals of balancing conservation and development, and eventually do more harm than good. Through an analysis of economic experiments in three villages of Colombia we explore such arguments and derive some results that can contribute to the challenge of designing better policies and institutions for the effective management of ecosystems. Further, the results will provide grounds for an emerging literature on the possibilities of conservation through community institutions and mitigation of the so-called 'tragedy of the commons' (Hardin 1968). Combined, these two results, on social losses due to state regulation, and the potential of community management, may be important for the design of policies in regions like Latin America where states have been unsuccessful in enforcing conservation mechanisms in protected areas and where traditional