Interest Groups, Nested Games, and Common Pool Resources

Left: Professor                         Center: Student                            Right: Gadfly

  1. Rational choice severely injured the pluralist tradition:[1]
  2.    For pluralists assumed that groups of individuals,
  3.         With a common interest, will form political
  4.              Interest groups to support their cause’s station;
  5.                   Much like single individuals act in situations,
  6.                       According to their personal invocations.
  7. But where is the rational is this pluralist tradition?
  8.    For if the group seeks to provide a public good, then,
  9.        Isn’t the rational choice to be a free-rider instead?
  10. Olson (1965) differentiates between small and large groups,
  11.    Happily, two types of small groups may overcome,
  12.        The collective-action problem.
  13.    First, privileged groups; whereas, one member contributes,
  14.        Due to the need for the action to be solved! Not explained!
  15.             Imagine a water park owner requiring mosquito spray.
  16.    Second, intermediate groups; whereas, no member actually has,
  17.         Sufficient incentive to provide the good alone, nevertheless,
  18.             Shirking is avoided due to the group’s smallness,
  19.                Thus organization and coordination is necessary,
  20.                     To ensure that shirkers get noticed,
  21.                           As mosquitoes to spray.
  22.     Decidedly, there is a path for large groups to succeed too.
  23.        Even though no one member can noticeable contribute,
  24.        And so no one member should spontaneously contribute,
  25.        Olson finds that only a separate, selective incentive will sway,
  26.        Rational choice to see individuals act in a large group-orientated way.
  27.     Incentives have been found to be coercion that punishes,
  28.        Or goodies that reward; like group rates on car insurance.
  29.     Thus a latent group may be mobilized by an entrepreneur,
  30.        With either a carrot or stick to steer,
  31.            Individual preferences. Is that clear?
  32. Nods and silence appeared,
  33. But one wanted to cheer:
  34. So elderly folk should free-ride the AARP,
  35. But they join, not because of the lobbying,
  36. Not because of the common goal to protect the trajectory,
  37. Of Medicare or other governmental things:
  38. But because car insurance will be cheap!
  39. Because the selective benefits outweigh the cost of joining!
  40. Yes. So rational choice theory did knock down,
  41.    The pluralist tradition in observing:
  42.         People may not join interest groups from the heart,
  43. Rather, for the money.
  44. Now rational choice theory is complex.
  45.    Let’s move on—and not digress.
  46. Tsebelis (1990) created a wave with Nested Games.[2]
  47.    If an actor is confronted with a series of choices,
  48.        Why would one choose an alternative to the best fit?
  49.    Cannot rational choice explain this contradiction employed;
  50.        Why a clearly sub-optimal option from the leadership,
  51.             Usurps sponsorship?
  52.    Thus rational choice does provide a systematic account,
  53.         For deviations from equilibrium.
  54. A student held the book,
  55. And interjected this hook:
  56. Tsebelis writes:
  57. “The essential goal of this book,
  58. Is to demonstrate that political context
  59. And political institutions matter in predictable ways,
  60. To explain why such regularities occur,
  61. And to provide a systematic way to deal with complicated,
  62. Political phenomena.”[3] Observe,
  63. There are multiple games!
  64. That’s right. Sub-optimality is the frame
  65.    That the researcher notices in one game.
  66.        Called the principle arena today.
  67. Political leadership deals with simultaneous involvement,
  68.    In multiple games, if investigated, are readily apparent.
  69.         Truly, the actor is intertwined in a network.
  70.             ‘Tis this whole network of games,
  71.                   That create “nested games” at work.
  72. Importantly, what appears to be sub-optimal in one game,
  73.     May be the most efficient course considering the network frame.
  74. There are two types of nested games.
  75.    (1) Games in multiple areas:
  76.             Leader-follower games in unions,
  77.             Legislative and electoral games in,
  78.                Congressional bargaining operations.
  79.    (2) Games by institutional design:
  80.             Innovation to increase options,
  81.                To improve upon the one previously adopted.
  82. Thus a rational actor constantly seeks to create a wiser path.
  83.    For increasing alternatives does enlarge strategy space.
  84.    This may even appear as small changes to the rules of the game.
  85. Thus losing a little in one game may still produce winning math,
  86.     Considering all of the other games in play.
  87. One chimed in:
  88. The first round of the Finnish presidential election,
  89. Quickly ousted the incumbent conservative,
  90. Thanks to apparently sub-optimal voting,
  91. Under the communists’ direction.
  92. For communists voted strategically against their preferences,
  93. By voting for the socialist instead of the agrarian,
  94. In order to eliminate the conservative candidate.
  95. But in the second round,
  96. The communists backed Kekkonen for President,
  97. Over the socialist known as Fagerholm.
  98. Strategically, then, conservatives in the second round also agreed,
  99. That there will not be a socialist in charge of Finnish country.
  100. So initial preferences were immaterial,
  101. And what mattered most—most of all:
  102. Preferences by institutional design created the game’s result!
  103. Thus sub-optimal behavior may not be so trivial at all!
  104. Tsebelis says, “Rationality is… an optimal correspondence
  105.     Between ends and means.”[4]
  106. And he adds, “It is not true that the rational choice approach,
  107.     Is the only possible approach to politics…even if psychoanalysis,
  108.        Social psychology, and behavioralism,
  109. Do not necessarily consider actors to be rational” companions.[5]
  110. On the other hand, rational actors must be consistent,
  111.     Meaning, these actors do not hold contradictory beliefs; or,
  112.         Certainly voting cycles should not be apparent [see hypothesis].
  113. Actors calculate the path to the desired outcome,
  114.     And then implement the strategy to gain momentum.
  115.          Game theory is quite prevalent.
  116. Accordingly, rational actors should not be anticipated to exist!
  117. Thus the schism,
  118. Between the political and the science.
  119. Some were losing attention.
  120. There are weak and strong requisites for rationality.
  121. This assures internal coherence of preferences and beliefs.
  122.    (1) At any one given point in time, preferences or beliefs,
  123.             Must be non-contradictory.
  124.    (2) Preferences must be transitive things,
  125.             A over B, B over C, thus A over C.
  126.    (3) Conformity with the axioms of—calculus,
  127.             Rational actors maximize the expected utility; must,
  128.                Take the (utility of an event) * (probability event will occur).
  129. Strong requirements of rationality demand external validity.
  130.    Thus a relationship between behavior/ beliefs,
  131.        And the real world we experience.
  132. Sounds like positivism to me!
  133. Between equilibrium, I mean, a situation in which no actor,
  134.    Determines the need to deviate from the preferred factors;
  135.       We call this Nash Equilibrium.
  136. More strong requisites for rationality, benefactors, include:
  137.    (1) Strategies are mutually optimal in equilibrium, deduce,
  138.             One can mathematically illuminate the space,
  139.             Denoting the actors amidst the nested game,
  140.             Measuring distances to pareto-optimality. Stiffly,
  141.             Players kowtow to prescriptions of game theory.
  142.    (2) Objective frequencies toward equilibrium,
  143.             Incorporate new information and revise various estimations.
  144.    (3) Indeed, beliefs approximate reality in equilibrium.
  145. If rational choice is a subset of human behavior, then,
  146. There are 5 good reasons individuals advance calculations,
  147.        Or why aggregated individual actions may be approximated,
  148.             By such calculations.
  149.    (1) Know the salience of the information or issue:
  150.             If you don’t play along; you may experience harm.
  151.    (2) Learning: repetition allows for trial and error review,
  152.             Rational choice thus better explains phenomenon,
  153.                With its strict assumptions.
  154.    (3) Heterogeneity of individuals: Even though everyone’s not smart,
  155.             The countless individuals whom are,
  156.                 Keeps equilibrium constant for intellectuals.
  157.    (4) Natural selection: Allowing for evolution of thought;
  158.             Different people at different stages may create unique outcomes.
  159.                 And successful behavior will be reinforced upon,
  160.                       The game—the phenomenon.
  161.    (5) Statistics: If rationality is small but a systematic component,
  162.             Then random distribution can illuminate,
  163.                 The mean—the median journeyman.
  164. Some students needed a break,
  165. But there was no delay.
  166. There are four advantages of rational choice, Tsebelis submits:
  167.    There is theoretical clarity and parsimony.
  168.    There is equilibrium analysis.
  169.    There is extensive use of deductive reasoning.
  170.    There is the interchangeability of individual beings.
  171. The professor could see many brooding.
  172. Alright, get in groups by month of birthday.
  173. You have ten minutes to write,
  174. A research hypothesis,
  175. Using rational choice theory.
  176. From November was continuous laughter.
  177. The professor calmed the class down and began again,
  178. With candor:
  179. Ostrom (1990) in Governing the Commons,[6]
  180.    Constructs an institutional rational choice analysis.
  181.        ‘Tis solutions to the problems inherent in collective action.
  182.    A self-governing institution does direct,
  183.        Individuals can run common pool resource projects!
  184.            Ostrom illuminates solutions for collective progress.
  185.    The research thus demands to know the circumstance(s),
  186.         Whence principle actors in an interdependent situation,
  187. Do obtain continuing joint benefits; while,
  188.    Preventing shirking, free-riders, and/or opportunists.
  189.         To escape calamitous mire is worthwhile!
  190.    A few heads were wondering,
  191. How to create, from this,
  192. A research hypothesis.
  193. And dominant paths for many decades,
  194. Argued that either the government or private industry,
  195. Ignoring other possibilities,
  196. Could administer the solution to penetrate.
  197. Thus Olson provides another perspective to activate,
  198. Common pool resources to sustain,
  199. The environment.
  200. Ostrom focuses on common pool resources (CPR).
  201.    To denote natural resources,
  202.        Utilized in common by many individuals.
  203.    Examples include fisheries, groundwater basins,
  204.        And irrigation systems.
  205.    These resources, for peoples on Earth,
  206.        Too often experience overexploitation and misuse,
  207.              By individuals acting in their singular best interests to boot.
  208.    The third approach to stop the pillage/underuse of the commons is:
  209.        Design a durable cooperative institution;
  210.              Organized and governed by the resource users themselves.
  211. As case characteristics, 50-15,000 people may rely on,
  212.    Common pool resources for economic sustenance.
  213. Some resources are renewable, while others are scarce,
  214.     Participants, under possible loss, have an interest to care.
  215. The heart of this study thus questions:
  216.     Isn’t it best if the participants agree,
  217.        On a common pool resource use understanding?
  218.     Couldn’t the actual participants be more efficient,
  219.        Than government or privatization efforts commissioned?
  220. She locates viable common property regimes,
  221.     Like Swiss grazing pastures, Japanese forests,
  222.         And irrigation systems in Spain and the Philippines.
  223. Now back to your research hypothesis.
  224. Imagine a way to exemplify the following 8 conditions in practice.
  225.    And fortunately Ostrom insisted that each of these situations,
  226.       May be unique or different according to circumstances.
  227. There are eight design principles observed in every CPR case.
  228.    (1) Defined boundaries: for the commons itself, and,
  229.             The individuals’ rights to use the CPR for oneself.
  230.    (2) The results from #1 are congruent with the local population,
  231.             As the rules are specific to actual resource allocation.
  232.    (3) Individuals affected by the rules are at least quasi members;
  233.             They are included in rule modification endeavors.
  234.    (4) The monitors finding infractions to the rules,
  235.             Come from the users themselves or accountable actors,
  236.                To the users’ pool.
  237.    (5) Sanctions reflect the severity, frequency and context,
  238.             Of the violation perpetrated and processed.
  239.    (6) Parties have easy access to low-cost local places,
  240.             To resolve disputes between appropriators,
  241.             Or other participants of the CPR commonplace.
  242.    (7) The rights of appropriators to design their own institution,
  243.             May not be infringed upon by external government.
  244.    (8) If the CPR institution is part of a larger system;
  245.             Then appropriation, provision, monitoring, enforcement—
  246.                 Are organized in multiple layers of nested enterprises.
  247. Alright. Quickly form groups of three. Designate a speaker to speak.
  248.    Discuss why policy-makers, bureaucrats, and resource users,
  249.        May stifle the effective management of common property resources.
  250.    And why are the three dominant models—the tragedy of the commons,
  251.        The prisoners’ dilemma, and the logic of collective action—
  252.            Inadequate?
  253. Many of the groups disagreed,
  254. Although one group understood clearly,
  255. Why Ostrom won economics’ Nobel Prize indeed:
  256. Under the former three models,
  257. The free-rider, prisoner and tragedy problems,
  258. Occur because rational individual resource users,
  259. Nash-ly act against the collectivity’s interests.
  260. Are these models wrong or out-of-date?
  261. No. But the conditions under which they hold,
  262. Are very particular to the specific cases they mold.
  263. They apply strongly when many,
  264. Independently acting individuals,
  265. Perceive high discount rates and little mutual trust,
  266. When there is little or no capacity to communicate,
  267. Or to enter into binding agreements.
  268. But what is the crux of Ostrom’s argument?
  269. The former models do not arrange for monitoring,
  270. And enforcing mechanisms to avoid,
  271. Overinvestment, overuse, and avoidable hemorrhoids,
  272. By the participants of the CPR community employed.
  273. Yes! The government need not meddle or privatize.
  274.    A CPR institution may develop the appropriate enterprise.
  275. In conclusion, institutional change is incremental and sequential,
  276.    It enables appropriators to gain the benefits of change,
  277.        Before changing again via necessary modifications.
  278.             There is trial and error learning.
  279.                 There is responsibility to gain!
  280. Rational choice, hence, illuminated a unique equilibrium!
  281.    For the governments and industries to understand!
  282.        CPRs may be realized as the wisest, rational, investment!

[1] Olson. 1965, 1971. The Logic of Collective Action: Public Goods and the Theory of Groups. Harvard University Press.

[2] Tsebelis. 1990. Nested Games: Rational Choice in Comparative Politics. Berkeley: University of California Press.

[3] Page 17. Emphasis in original, depicting that this systematic approach will help make it accessible.

[4] Page 18.

[5] Ibid.

[6] Ostrom. 1990. Governing the Commons: The Evolution of Institutions for Collective Action. New York: Cambridge University Press.

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