Inequality, differential technology for resource extraction and voluntary collective action in commons

Due to inequality in distribution of private wealth and market imperfection if individual members in the society have access to different technologies for extraction of common property resources (CPR), resolving ‘collective action dilemma’ for efficient use of CPR through voluntary participation becomes a difficult task. To lend concreteness to the problem, in the context of Indian semi-arid rural society, this paper has chosen one among those very well-known CPR management problems, viz., conservation of water resources, for irrigation. With the help of a two-stage bargaining game model—with stage one, related to water harvesting and stage two, related to agricultural production—it shows in terms of an asymmetric Nash solution that different types of community programmes based on (i) equal entitlement right to water and (ii) switch over to less water intensive agricultural production cannot ensure successful equitable and efficient water management through voluntary participation. In the presence of inequality and market imperfection, the incentive mechanism to increase efficiency in water use for the purpose of conservation will enhance inefficiency outside the commons water periphery. [Copyright &y& Elsevier]