Previous laboratory experiments, using quite complex resource simulators, suggest that renewable resources are over-utilised because of a general tendency for people to systematically misperceive the dynamics of bioeconomic systems. Here, similar experiments with simplified simulators involving the management of reindeer rangelands are carried out. Sufficient information is given for the subjects to construct perfect mental models. Misperceptions persist for a simulator containing only the basic building block of all dynamic systems: one stock and two flows. Results deteriorate in a second treatment where a two-stock model is used. Compared to earlier studies using questionnaires, where subjects do not benefit from repeated outcome feedback, the experiments show that, even in these simple systems, information feedback is not sufficient to make up for misperceptions. Simulations are used to test two hypothesised decision rules: the optimal policy is rejected; a simple feedback rule is not. Altogether, the experiment and the simulations provide both a motivation for and an introduction to studies of system dynamics. Copyright © 2004 John Wiley & Sons, Ltd.Syst. Dyn. Rev. 20, 139-162, (2004) There are numerous examples of overexploitation and at times extinction of renewable resources, think of, for example, whales, forests and fish, as well as some reindeer pastures. A prominent theory for why this happens is the "tragedy of the commons" (Hardin 1968;Gordon 1954; and others back to Aristotle). However, overexploitation has also taken place for privately owned renewable resources and for shared resources with policies in place to tackle the commons problem. An alternative or supplementary theory for overexploitation is misperception of dynamics. Laboratory experiments show overinvestment and overutilisation even when the subjects (students and professionals) have full property rights and monetary incentives to behave optimally (Moxnes 1998a,b;. These results are consistent with experimental studies of other complex dynamic systems (e.g., Sterman 1989a,b;Funke 1991;Brehmer 1992), showing, with few exceptions, considerable deviations from normative standards.The laboratory experiments used thus far have been characterised by considerable complexity and ambiguity about model structure and parameters. Here we construct similar experiments, but reduce the complexity to a minimum. In the present experiments it is possible to reconstruct perfectly the underlying model and its parameters from the instructions. Consequently, 139 * Correspondence to: Prof E. Moxnes, Dept. of Information Science, University of Bergen, PO Box 7800, N-5020, Bergen, Norway. E-mail: Erling.Moxnes@ifi.uib.no Thanks to the editors and referees for valuable comments and to the students for participating in the experiments and for ensuing discussions.
An exploratory search for explanations of mismanagement of renewable resources, other than the theory of the commons, was performed by an experiment. Eighty three subjects, mostly recruited from the fisheries sector in Norway, were asked to manage the same simulated virgin fish stock, one subject at a time. Exclusive property rights were granted to rule out the commons problem. Despite perfect property rights, subjects consistently overinvested, leading to an average overcapacity of 60%. The resource was reduced by an average of 15% below its optimal level. Overcapacity and tough "quotas" resemble the situation in Norwegian and other fisheries during the past few decades. The likely explanation of the observed behaviour is misperception of feedback, a phenomenon that occurs in many experimental studies of dynamically complex systems. Such misperceptions add a new and important dimension to the problem of renewable resource management, beyond the commons problem.Commons Problem, Bioeconomics, Decision Making, Experimental Economics, Misperception of Feedback
Global climate change is an atmospheric commons problem where the basic actors are the states. In democratic nations national policy initiatives depend on the opinion of the electorate. Unless there is a proper popular perception of climate change, it will be difficult to undertake appropriate and timely measures. Previous experimental studies of people's understanding of climate change and of other renewable resource problems have revealed that people misperceive the basic dynamics and that they favour decisions that are systematically biased in the direction of over-utilisation. In the present laboratory experiment, with 251 students, the focus is on understanding why people misperceive and how misperceptions could be avoided. Using a simulator, the subjects are asked to control total global emissions of CO 2 to reach a given target for the atmospheric CO 2 -concentration. Compared to a previous study we find that full information about a simplified system leads to improved performance, particularly among students with a background in mathematics. Subjects perform better in an analogous, however more easily visualisable system, indicating that they have difficulties forming appropriate mental models of the more abstract atmospheric problem. Two information treatments, thought to improve mental models, turn out to have insignificant effects. Finally, information feedback about the development of the CO 2 -concentration helps. According to our findings, current information from the IPCC and the standard media coverage is not effective in helping people to choose policies that are consistent with their own preferences.
In the face of global or regional environmental problems, do countries that take unilateral actions inspire other countries to curtail emissions? The effect of leadership at the individual level is investigated by the use ofa novel design ofa laboratory public bad experiment with a leader. Twelve groups of5 participants played the game twice with two treatments: 10 rounds with a leader and 10 rounds without a leader. The order ofthe treatmentswas balanced over groups. A significant (within-subject) effect of leadership is found. Followers invest, on average, 13% less in the public bad when there is a leader setting the good example as opposed to a situation with no leader. This produces benefits also to the leaders but not enough to recover all the costs of taking a leading position.
The article summarizes key insights from four laboratory experiments to study renewable resource management. The commons problem, which is widely held to be the cause of mismanagement of common renewable resources, was ruled out by the design of the experiments. Still the participants overinvested and overutilized their resources. The explanation offered is systematic misperceptions of stocks and flows and of nonlinearities. The heuristics that people apply are intendedly rational for static, flow resources, but not for dynamic, stock resources. Simplifying and reframing the management problem, by focusing on net growth rates, is suggested as a means to foster the use of more appropriate heuristics. Copyright © 2000 John Wiley & Sons, Ltd.
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