Essay on Career and Writing of Elinor Ostrom

Subject: Economics
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Study level: PhD

Educational and Professional Background

Dr. Elinor Ostrom is an American born political scientist who is credited for some of the most influential ideas in the realm of economics and governance. She was born in the city of Los Angeles in the year 1933 to Leah Awan and her Jewish father Adrian; from an early stage when she was still young Ostrom was exposed to the challenges of resource scarcity. It is perhaps during this early period of her life at a time when there was great economic depression being experienced throughout United States that excited her interest to study resource utilization and community behaviors. But then again, it is probably her prowess in education that ended up being the reason of her success in academic achievements that were later to follow; whichever the case, it would seem there was more than one factor that eventually contributed to her success.

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In 1951 when she was barely 18 years old, Ostrom was among the few students in the country that graduated from high schools with good enough marks to qualify to join university and certainly one of very few girls for that matter (Ostrom, 2010). This exemplary performance at high school qualified her to earn a slot at one of the top institutions of higher education in the country, University of California, Los Angeles (UCLA). While in UCLA she pursued a Bachelor of Arts in Political Science where she graduated in 1954 with honors; a feat that proved her academic brilliance and of course her ticket to even higher achievements (Ostrom, 2010). In 1962 she successfully completed a Masters degree (MA) in Political Sciences and three years later attained her Ph.D in the same specialty of Political Science at the same institution (Ostrom, 2010).

It would have appeared that she had reached the crest of her academic and probably professional career with this last achievement of a Ph.D degree, but looking back at her career and professional achievement now it would seem like she was just getting started. It is hard to appreciate the circumstances that shaped the career development and achievement of Dr. Ostrom without considering her past, indeed her impressive academic performance was a major factor that contributed significantly to her professional success. But like all great men and women this is hardly the only reason and luck seems to be a break they get at one point or another; incidentally it appears that Ostrom had a keen interest in areas pertaining to natural resource and utilization. Quite early in her academic career Ostrom was already delving into issues of natural resources; in fact the topic of her dissertation at master level was on water management in California that also involved factors of community collaboration which was very similar to what become one of her pet subject “self-organization” (Zagorski, 2006).

Even her earliest project was on manmade resource which was a study on police industry that she investigated for more than one decade; it was one of her very first projects that she took while she was at Indiana University teaching political science (Zagorski, 2006). It is from this early research project that Ostrom’s ideologies on policing were developed which ironically also provided her with a stepping stone to more focused, in depth and complex research projects on areas of both natural and manmade resources, what are collectively known as commons or CPRs. In 1969, Ostrom together with her husband Vincent Ostrom began laying the foundations of what would later come to be their biggest legacy and the most accomplished achievement of her life; the Workshop in Political Theory and Policy Analysis (Zagorski, 2006).

What began as a farfetched idea that brought together professionals with various skills and educational background to discuss issues that were cross-cutting several educational disciplines has now evolved to become a leading international focal point of research and of political issues and resource management. This Workshop in Political Theory and Policy Analysis also serves another important function that has been integral to Ostrom’s various research projects worldwide. It is the think tank through which she is able to effectively research and coordinate her various research initiatives that spans the globe. Indeed it is not hard to realize that it this organization that had been crucial and which had played a pivotal role for development of some of her most ground breaking theories on issues of resource management, sustainability and politics.

These in summary are the early times, educational and professional background of Dr. Elinor Ostrom that significantly shaped and contributed to her later life achievements in the field of political science. In the following section we shall get to discuss some of her most influential academic works, research projects and notable achievements that culminated to her nomination for the 2009 Nobel Memorial Prize in Economic Sciences which she shared with another influential scholar, Oliver Williamson.

Workshop in Political Theory and Policy Analysis

Before we can start to analyze and discuss various academic work and research projects written by Dr. Ostrom, it is important to briefly review the think-tank that has been the backbone of her research initiatives, which is sort of an incubator of her brainchild ideas. The Workshop in Political Theory and policy analysis has been operational since the year 1973 when it was officially launched under the auspices of Indiana University. When one takes a critical look at the nature and breadth of Dr. Ostrom’s various research interests and her model theories in the field of management and political science, it is not hard to realize that it is the workshop which is at the middle of all her major breakthroughs. In the early years of its inception the Workshop in Political Theory and Policy analysis was originally designed to be a platform that brought together professionals from different backgrounds to discuss various unrelated topics of interests. Later on as the institution grew and started attracting key persons with specialized skills, it slowly transformed to become the couples headquarters where they would coordinate and direct various research projects of interests, a tradition that it has kept up to this day.

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At the moment it has been operational close to four decades and is now a fully fledged research institute which is still affiliated to the University of Indiana. The idea behind Workshop in Political Theory and Policy Analysis was informed by the need to shape key policies that touched on resource management and therefore the way of life of community members. Indeed the research findings of this research institution on policy so far indicates that human behavior is the major determinant that shapes people’s perception and interaction with their resources, which is a factor that is greatly influenced by existing government and local policies. As such the Workshop in Political Theory and Policy analysis dedicates most of it resources in researching human behavior in context of government or public policies as far as resource management and utilization are concerned.

Because an extensive focus of the research instititution is dedicated to human behavior, it has become necessary for the research institute to adopt a multidisciplinary approach in understanding these determinants of human behavior in context of all other related factors. For this reason the research institution on political theory and policy analysis has come to rely largely on professionals with various educational backgrounds and skills who enable different perspectives necessary to understand human behavior in various contexts. This mandate and core research areas of the Workshop in Political Theory and Policy Analysis is well captured in it mission statement which states its purpose “is to promote the interdisciplinary study of institutions, incentives, and behavior as they relate to policy-relevant applications”. So far the Workshop’s Institutional Analysis and Development (IAD) Framework areas of research has been undertaken at four major fields of interests; healthcare, natural resource management in context of community institutions, democratic governance and public economies. As we would later come to see in this paper during discussion of Dr. Ostrom’s various influential works, these are the major areas that all of her research projects and academic works relate to.

It would be impossible to discuss Dr. Ostrom biography and achievement without discussing the brainchild of her first years of research soon after she began her career immediately after finishing her PhD. It is not hard to tell that this is probably one of the main motivator that made Ostrom delve into study of resource utilization and community institutions in later years of her careers given that she spent 15 years on it. Probably the longest time that she ever dedicated to a single research project throughout her professional career, which is far more time than any of her other projects that were later to follow.

Police Industries

During the early 1960s when Ostrom began earnestly studying the police industry the perception was that complex systems were more efficient than smaller units, which was a notion that Ostrom would later come to disprove by the end of her research study (Ostrom, 2009). This idea of complex system being more efficient was the reason behind the public advocacy to have an integrated system that was perceived to be more cost-effective and efficient than present disjointed police units dispersed across the cities which existed at the time. The earliest scholarly efforts to determine the accuracy of this hypothesis were spearheaded by Vincent Ostrom et al who were the first to develop a framework of analyzing the efficacy of polycentric systems; this was until Elinor Ostrom come along (Ostrom, 2009). Ostrom’s approach of studying the police industry started small as a study that was initially limited to one urban area but later expanding to cover six major cities in which it critically reviewed the efficacy of police systems in these cities (Ostrom, 2009).

For a long time to come, these police departments, be it small, medium and large would be the focus of Ostrom interest in which they exhaustively studied through detailed measurement of their efficacy. By the end of synthesizing all the relevant data from the research study Ostrom has arrived at important findings that drastically transformed traditional ideas that policy makers were relying on to shape policies in the police industry.

A summary of the major findings resulting from the study outlined several major ideas that were backed by evidence from the study; for one, large and complex police units were not found to be any efficient than smaller sized police units, which disproved earlier public perception of large police department being more efficient (Ostrom, 2009). Nevertheless, the study did recognize that large police departments were more efficient in some aspect than smaller police units, notably in provision of direct services such as patrol and indirect services such as forensic investigations (Sagel and Rosser, 2009).

The implication of these findings supported a model police department that integrated both features of large and small department in order to benefit from the unique advantages presented by each of these two forms of police department. These research findings were instrumental in shaping the resulting policies in police industry that ultimately maintained the status quo of large police department, albeit with minimal modifications. But these were not the only result of the 15 years study; during the research analysis two other forms of goods that were not previously well elaborated on previous studies become evident; Common Pool Resources and toll goods (Ostrom, 2009). CPRs would later come to be the focus of an entire research study and an underlying theme throughout all subsequent Ostrom studies as we shall later see. Previously, many research studies identified only two types of goods; private and public, thus, Ostrom work on police industry was significant in other areas that were beyond police department studies.

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As you can see therefore it is from here that Ostrom set out to test and apply the basic principles that she had accidentally stumbled upon during this early study on police industry. This early efforts were part of her journey that would culminate to her recent co-nomination for the Nobel Memorial Prize in Economic Sciences. As we delve deeper and get to analyze her most notable works that she has accomplished through her professional career this fact will become even more apparent (Ostrom, 2009).

Governing the Commons

One of Dr. Ostrom’s earliest research initiatives that she steadfastly kept on investigating since the inception of Workshop in Political Theory and Policy Analysis, and probably even before that was in the area of resource utilization by communities. It is this early research initiatives that culminated in her productions of one of her foremost influential works, which was a book titled “Governing the Commons: The Evolution of Institutions for Collective Action” which was published in 1990 (Ostrom, 1990). This book provided the earliest insights that contradicted widely held beliefs and practices that were influential in shaping key public policies at national and community levels in natural resources. Governing the Commons is a book that was based on an earlier concept developed in 1968 by an economist named Hardin who invented the term Tragedy of the Commons in reference to the unsustainability of the world population competition to the limited world resources (Schlager and Ostrom, 2003). Since then this terms has been predominantly used to refer to nature of regulations and rules that exist among community members who are engaged in exploitation of a common natural resource.

In governing the commons, Dr. Ostrom’s focus is on the nature of challenges that must be addressed by the community members in order to realize optimal benefit from the shared community resource, be it natural or manmade. Dr. Ostrom’s research on community utilization indicates that communities must first address these challenges before it can be able to effectively manage any form of common resource (Ostrom, 1990). This is the subject matter of Elinor Ostrom book; Governing the Commons. To fully understand the ideology that Ostrom is advancing through her book of governing the Commons, one would have to analyze it in the larger context of other related works that Ostrom might have relied on in order to develop her model solution that she advances in this book.

The Tragedy of the Commons scenario that is articulately described by Hardin summarizes the present circumstances that exist where resources are publicly shared among community members (Hardin, 1968). In a situation where utilization of public resources is unregulated by any set of rules, the result is unfair exploitation of community resources that has adverse implications to a section of the community members that is not sustainable in the long run because they lack what Bergstrom refers as the “Nash Equilibrium” (2010). To address this unfair outcome various research studies have attempted to apply a set of theoretical approaches that are aimed at solving this challenge by fostering an environment that is conducive to implementation of community policies on resource utilization.

One such early model of addressing these challenges was advanced way back in 1954 by Gordon from a research study on economics of fisheries in which he elaborated on key findings that he pointed out could effectively be applied in any form of resource management at community level (Bergstrom, 2010). This early research by Gordon was the main influence behind the commons models that was developed from two unrelated perspectives; from a Pigovian approach and the property rights approach (Hardin, 1968). The property rights approach advances the concept of “property rights” which restricts accessibility to common communal resources by way of privatization (Bergstrom, 2010). The Pigovian approach on the other hand implies there is need to establish structures meant to regulate utilization of communal resources which should ideally be in form of taxes and regulations (Bergstrom, 2010).

What Dr. Ostrom advocates in her book Governing the Commons, is a third approach that explains the determinants of utilization of natural community resources to show the impossibilities of applying a single framework in solving the intricacies of resource utilization that she describes to be unique to every community. Through analysis of various community settings resource utilizations that make up large part of the case studies that are contained in the book, Ostrom has been able to advance a convincing model that solves the problem of common access, or so it seems. Thus, the focus of Ostrom book is on identification of underlying set of communal arrangements that has enabled efficient use of commons in communities where CPR utilization is a success story (Dietz, Ostrom and Stern, 2003). Common-pool resource (CPR) is the term that Ostrom uses to generally describe the nature of publicly utilized resources that exist in almost all major communities (Schlager and Ostrom, 2003). CPR is thus a term that collectively describes both manmade and natural resources that are found in a community which often include; water resources, forests, pastures, land tenure, fisheries, wildlife as well as what has now come to be referred as “global Commons” which include issues of air pollution, climate change and transboundary disputes triggered by competition of resources.

An integral section of this research study includes case studies of various forms of commons worldwide that have continued to function under an elaborate communal system in what would appear to be a more effective way of resource utilization than is the case where national policies are implemented to manage the same resources. It is from these studies of seemingly unrelated projects on commons such as the Alpine pastures, communal forests in Japan and Swiss villages that also included irrigation projects in Spain that Ostrom was able to develop her central finding that is extensively supported by the large volume of data collected from them. By the time she was done researching the element of commons in these different projects Ostrom has uncovered an interesting trend that was to a large extent new knowledge which was very different from what policy makers were relying on to design laws of governing utilization of commons at national or communal level.

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Foremost, her research studies indicated that the complexity of issues that were involved in management of commons in communities were far more diverse and intricate than present policies and economic models could effectively address (Dietz, Ostrom and Stern, 2003). Two, that existing approach that policy makers continue to rely on to promote and foster sustainable methods of resource utilization at communal level are faulty, for the simple reasons that they are not able to exhaustively address the range of diverse actors that are key to an efficient common system in which the community members are centrally placed (Ostrom, 1990). Other major findings that are exemplified by Ostrom’s book on Governing the Commons is an observation that people’s attitudes is one of the most important factor that significantly determined their ability and resilience to create communal institutions of managing the commons without necessarily relying on any other forms of regulations (Ostrom, 1990). This is the point that Ostrom is referring to when she states that “People are trapped by the Prisoner’s Dilemma only if they treat themselves as prisoners by passively accepting the suboptimum strategy the dilemma locks them into” (Ostrom, 1990).

The Prisoner’s Dillema game is an interesting concept which is very similar to the scenario presented by the tragedy of the commons where what appears to be seemingly rational actions among community members result to very irrational consequences. It is probably the insight that is gained from this observation that makes Ostrom’s work on study of commons very knowledgeable and controversial as well. In this book, Governing the Commons, Ostrom aptly summarizes this observation by stating “The paradox that individually rational strategies lead to collectively irrational outcomes seems to challenge a fundamental faith that rational human beings can achieve rational results” (1990).

In addition Ostrom research on commons indicate that communities that have reliable and effective systems of managing their resources have a set of seven prevailing characteristics that sets them apart from other communities.

Most notable of these characteristics include; well defined group boundaries, clearly developed regulations of resource utilization that are integrated in community way of life, flexibility of policies that govern use of CPRs, efficient systems of monitoring member compliance that has elements of deterrence and simple cost effective conflict resolution methods that arise out of use of CPRs (Ostrom, 1990). These are factors that Ostrom has identified must be present in any community setting that attempts to achieve fair use of commons utilizations and what should ideally be fostered by all the stakeholders. But there is a catch because what Ostrom is advocating in this case is not a model that is applicable uniformly to all form of CPR utilization that exist in all communities of the world.

Indeed what is evident in this theory are the distinctly different approaches through which communities have been able to achieve model systems of regulating resource use that are not the same for any two given communities that Ostrom had set out to study during her research. Needless to say this is a major reason that national policies that attempts to regulate fair use of communal resource have always failed. This early concepts on study of commons that Ostrom was researching at this time would later be the foundation to several of her later works such as on institutional organizations including her most recent publications on Understanding Institutional Diversity.

Rules, Games and Common-Pool Resources

In order to fully grasp the theme that Ostrom advances in her book Governing the Commons it is essential to briefly review an interesting concept that she formulates at a later stage to describe the inherent challenges experienced in utilization of CPRs, which she refers as the Game Theory. The Game Theory is a concept well elaborated on another work that Dr. Ostrom produced in conjunction with other renowned scholars four years later in 1994 after the publications of her fist ground breaking book. The Game Theory that Ostrom describes refers to the interaction of the various actors in the community with their CPRs in a scenario that they realize cannot result to any sort of Nash equilibrium (Bhattacharya, 2009). For this reasons the focus of this book is on understanding the institutional setups and characteristics that have evolved over time to become model examples of fair use of common pool resources.

Game Theory is a concept that has been applied in various disciplines from military strategies, study of cartels and even in understanding oligopoly industries. The work by Ostrom et al on this publication is therefore just an application of the same concepts in understanding common resources as utilized by communities. The prisoner’s dilemma which Ostrom et al mentions is an important element in the game theory that highlights the implications of a participant move to the other participants in the game, which is seen to be inherently tied to choices of all the other players (Bhattacharya, 2009). This is very similar to the scenario and range of choices that community members experience in the process of utilizing a common resource.

A study undertaken by Meinhardt elaborates on game theory and describes Ostrom et al Game Theory as a form of convex game which serves an important function of providing insight through interpretation of its rules (2002). In this game setting a particular participant who is denoted with “I” is allowed to undertake and implement a strategic actions “xi” towards utilization of a common resource (Meinhardt, 2002). This set of actions by a single actor is undertaken in consideration of other participants who also have vested interests towards exploiting the same CPR. Actions by any single participant has two immediate implications; one, the isolated actions determines the nature of return that the other players will obtain from the CPR that is being utilized and two, the nature of strategic decision arrived by an actor in the game determines the proportion of returns they get to obtain from the CPR (Meinhardt, 2002).

As such the type of decisions that participants are inclined to undertake primarily depends on the form of regulations that exists at the community level of managing resources. This is the context upon which the Game Theory sets out to investigate the nature of regulations that exist at community level which are crucial to preventing what Hardin originally described as Tragedy of the Commons. In fact, this Game Theory described by Ostrom et al is one of the few documented models that provide evidence which indicates it is possible to evade what have always been thought to be inevitable when it comes to utilization of commons (Meinhardt, 2002).

Throughout the study of CPRs in community setting, Ostrom and her team analyzed a total of more than 90 specific types of CPRs in diverse communities, 44 of which included fisheries while another 47 were on irrigation (Ostrom, 2009). The implication of the research findings from this study were as phenomenal as the once arrived through the study of police industry; on a simple comparative level, community managed CPRs were the most efficient with a success rate of 72% (Ostrom, 2009). On the other hand, government managed CPR that were centrally managed had a success rate of 42%, which is 30% less efficient or if you prefer, predisposed to fail 30% of the times (Ostrom, 2009).

In this regard, Ostrom et al work on Game Theory strengthened other current research findings on the same subject of CPR and charted new course upon which future research studies should focus. Most notable contribution of Ostrom et al theory on CPR utilization is its deep insight on the intricacies and elements of decision making that takes place among various participants in real life scenarios that involve utilization of commons (Faysee, 2005). As Ostrom personally states in one of her many journal article publications regarding the lessons postulated by the Game Theory and the Collective-action theory which she describes to be among her key findings “is recognizing the complex linkages among variables at multiple levels that together affect individual reputations, trust, and reciprocity as these, in turn, affect levels of cooperation and joint benefits” (Ostrom, 2010). This implies that unlike unmanaged CPRs, achievement of fair use of commons is a process that is far beyond the mere establishments of centralized policies that are aimed at regulating and managing CPR as is widely practiced at the moment.

Based on these findings this theory also disproves the efficacy of a blanket model that is designed and applied uniformly to address utilization of CPR challenges as we have previously discussed (Ostrom, 2010). It is notable to note that as early as 1986; Ostrom was already actively investigating the difficulties that people experiences in making decisions under the prisoner’s dilemma scenario as well as factors that led to the tragedy of the commons. Thus in one of her presentations during this time Ostrom noted that “the cases in which people overcame the barriers to collective action are as important as the cases in which they fail”; implying that neither the positions presented by the prisoners dilemma or the inevitable outcome of tragedy of outcome observed by Hardin could be attributed to failure of manageable CPR (Rodgers, 2010).

Indeed, a comprehensive analysis of the various success story of well utilized CPR indicates that fair utilization of commons has been achieved by communities faced with similar challenges that exist in any other typical society. It would then appear that an extensive part of Ostrom’s contribution in the book Rules, games and CPRs was actually based on a decade of research projects in which she was studying the utilization of commons by communities. In the following section of this paper we are going to review Ostrom work and contribution to the field of institutional management which has been very influential in various disciplines notably economics, sociology and politics.

Understanding Institutional Diversity

This is one of Ostrom most recent publications that she produced in 2005; in this book she has focused on analyzing the characteristics and nature of institutions, particularly how they come about, their operation processes and their evolution. For this reason, this book contribution is cross-cutting through several disciplines that include sociology, economics and political as we shall find out during our analysis. Not surprising this recent work of Elinor Ostrom is based on earlier research that investigated management of common pool resources which has also been the focus of most of her other earlier notable publications. As such what Ostrom presents in this book is new form of insights in management of CPRs that has been informed by current knowledge generated through extensive research projects that she continues to undertake.

In addition, this book is most relevant because it was produced at a time when Ostrom’s earlier ideas on CPR served to agitate increased research studies in the field of resource utilization because of her radical theories contained on her earlier works. To understand the value and relevance of Ostrom’s recent publications that includes this book, one would have to refer to the nature and type of research projects that Ostrom has undertaken over the years under the auspices of the Workshop of Political theory and Policy Analysis which has been the recipient of several large research grants.

The study of understanding institution is a continuation of Ostrom earlier insight contained in the book governing the commons in which she identifies a set of seven principles that are found to be common in all stable establshments in what she describes as “long-surviving institutions” (2005). In this study, Ostrom takes the investigation of efficient institutions a notch high by testing empirical studies in laboratory setting under controlled conditions that allow study of specific variables in context of desired settings. It is this approach that resulted to phenomenal insight that explained the difference in efficacy of community-run institutions compared to government-run institutions.

A model that is central to Ostrom’s work on Understanding Institutional Diversity is the Institutional Analysis and Development (IAD) framework which is designed to empower social scientists to determine the nature of resulting human behaviors and choices depending on the community characteristics (2005). IAD is a broad concept that encompasses issues of regulations that exist among different actors, community setting and nature of resources under which the various forms of interactions are undertaken (Ostrom, 2005). IAD framework is based on a concept of “exogenous variables” and “internal parts”; exogenous variables are set of determinants that influence participants’ behaviors which in turn affect their choices and resulting outcomes (Ostrom, 2008). The internal parts of actions are essential elements that are necessary in design of game theories, laboratory experiments and developing plans of data collection and coding (Ostrom, 2008).

In the preamble of this book Ostrom mentions that “to understand institutions one needs to know what they are, how and why they are crafted and sustained and what consequences they generate in diverse settings” (2005). This statement aptly summarizes much of what Ostrom sets out to achieve in this work through application of previous concepts such as game theory as well as new concepts. Because this is by no means a general summary of this particular work of Ostrom, my focus would be on the major themes advanced in this book and their relevance to modern day applications in resolving pertinent issues that Ostroms investigates. Ostrom identifies the central theme of her book by emphasizing the importance of studying and understanding institutional which is a process that she admits has been a long feat which has taken herself and her teams many years of research as evidenced by the numerous research projects, research studies and theoretical investigations on the subject.

An important aspect that Ostrom achieves through this work is development of an IAD model that guides policy makers and individuals in identification of optimal levels of interaction for any given scenario (Karni and Chakrabarti, 1997). To achieve this, Ostrom presents strong evidence on the importance of having what she refers as “multilevel taxonomies” which is basically the number of layers of universal component that exist in communities which are seen to influence their behavior as well as choices (Ostrom, 2005). The implication of this assertion by Ostrom therefore indicates that theorists can be able to determine through approximation the nature of human behavior under specific conditions as long as they can be able to accurately determine the elements of a particular situation. To a large extent, part of this process still relies on the game theory that Ostrom discusses on previous publications but which is discussed in this book at much higher levels. Because of the unique insight that game theory is able to provide concerning a particular scenario, Ostrom integration of this model of game theory within the IAD framework provides a reliable approach of understanding and predicting human behavior that is seen to be applicable in many other forms of settings.

Ostrom work on Understanding Institutional Diversity is also relevant since it provides evidence of what she has hypothesized in her earlier research on human behaviors which holds that “individuals are fallible learners trying to do the best they can in the long term by using norms and heuristics in making their immediate decisions” (1990). This is an important characteristic of human nature that Ostrom postulate and goes on to rely throughout the book as the yardstick of testing various theories discussed in the book. A research study by Karni and Chakrabarti that discusses Ostrom various works identifies the relevance of her findings especially in political institutions which is based on her theoretical insights on the study of institutional diversity (1997). One of the observations made concerning Ostrom study in political institutions is the orderly manner upon which transition changes were implemented based on set of mutually applicable regulations. This is identified as one of the characteristic nature of “long-lasting common institutions” typical of political dynasties that are seen to withstand the test of time (Karni and Chakrabarti, 1997).

Along the same line Ostrom discusses the process through which new and old institutions evolve occasioned by the need to manage newly identified CPR. In this regards, she articulately discusses how the process of formulating rules and regulation is undertaken from the first stage to the last step for efficient institutions. Having explored the background and inner working of major types of institutions, Ostrom then proceeds to discuss several notable examples of institutions worldwide that have been unable to manage resources in context of existing body of knowledge generated from studying model examples of well functioning institutions. Thus, from this backdrop one is able to relate and fully understand the particular reasons that Ostrom identifies as obstacles that hinder the efficacy of these institutions and which therefore are responsible for their collapse.

This is among the most valuable and influential insights that Ostrom is once again advancing that are backed by empirical data which have now become influential in shaping new strategies aimed towards managing institutions. In fact, based on her investigation of various common resources that have been failed by the inefficiency of their institutions mandated to manage them such as the forest resources in Nepal, irrigation projects of Srilanka and fishery projects in Turkey, Ostrom is able to identify a set of common characteristics that can be attributed to failure of institutions responsible for managing these CPR. Top on the list of what she attributes to fail these institutions are three factors; inability to cope due to change in technology, interference by external stakeholders through introduction of policies that are incompatible with community values and failure to integrate community participation in the process (Ostrom, 1997).

Thus, Ostrom work on understanding institutional serves to bridge this knowledge gap that is crucial in preventing the adverse results of arbitrary implemented projects that are very costly to the community at long last, as well as avenues through which crucial resources are wasted. To understand the cost implications of Ostrom revolution ideas on understanding institutions let us briefly analyze the cost inquired by the community and other stakeholders such as donors in the event of an institutional breakdown.

Cost Implications of Institutional Breakdown

Perhaps one of the most adverse effects in recent years that have occurred as a result of institutional collapse happened in Brazil as a result of a wrongly implemented project sponsored by the World Bank under the auspices of development aid. Between the year 1982 and 1985, the World Bank channeled a total of more than $434 million dollars towards creation of a resettlement scheme that was referred as “Polonoroeste” (Hancock, 1992). The idea behind the project was to create a resettlement scheme that farmers could expect to obtain higher yield from cultivation of crops; for this reason it was designed to be located at the Amazon basin in an area that was extensively covered by forests and which therefore needed to be cleared before settlement could be undertaken. For whatever possible reasons that could have existed at the time to occasion the need of having farmers exploit the virgin land through destruction of the forest and jungle in unregulated manner, the World Bank agreed on financing the full cost of the project.

Without an effective strong institution in place to manage utilization of commons by the community, which in this case was the arable land and forest, the community started exploiting the available resources in what Ostrom would describe as free-loading. In just a matter of few years 4% of the rainforest area has been depleted at such an alarming rate that reached 11% by 1985 (Hancock, 1992). Current estimates from NASA space surveys during the 1990s indicated that less than 20% of forests cover would have remained by the end of the century (Hancock, 1992). Because of over exploitation of the land and forest resource by the farmers, every year it turns out the yield is drastically reduced thereby defeating the very idea that prompted the destruction of the forest in the first place, which was to clear just enough land. In fact having realized the unsustainability nature of this huge project the bank belatedly admitted that Polonoroeste was “an ecological, human and economic disaster of tremendous dimensions” (Hancock, 1992).

The story is the same elsewhere where massive developmental projects have been initiated through developmental aid; In his book Lords of Poverty, Hancock documents some of the most adverse projects that has resulted in adverse effects to the community on which they had been undertaken simply because of institutional collapse that always resulted soon after they have been completed (1992). Another example that Hancock provides is implementation of a ranch project in western Kalahari by FAO in 1972 which become untenable shortly after it was completed because of overgrazing by sheep’s and cattle’s (1992); A scenario that had never happened in all the years that Kalahari had existed, but which happened all the same when FAO came along with their idea of this project. In fact, Hancock documents another similar project that FAO undertook in the same region in 1977; “Livestock II” which was also met by the same failures of overgrazing like the one before it (19920.

In most of this examples that are well documented by Hancock it would seem that the problem was with the structure of institutions that were delegated with the task of managing the resulting commons, or perhaps the interference and subsequent destruction of the communal institutions that had in place which the projects was competing to replace. I have taken this detour to discuss several of the most well documented adverse effects that have occurred in communities because of institutional breakdowns in recent history for two major reasons. One, in order to highlight Ostrom’s theories on fair utilizations of CPRs and study of institutions which are relevant to our understanding of the reasons that made these projects fail. Second, to exemplify the implications of Ostrom’s contribution to the field of CPR management, economics and probably politics as well; albeit a small area where her various theoretical models have been applicable.

Conclusion

To a large extent Ostrom’s many years of research which focused on study of CPR and analysis of institutions is the reason that led to shift in theories by scholars and formulation of new policies by policy makers. Thanks to the “uncommon insight of Elinor Ostrom” as one research article defined her ingenuity, the traditional theories that postulated individuals as helpless actors in management of commons are no longer thought to be valid. And because of this shift in ideology, various scholars has been able to investigate and advance new theories to address the challenges faced by community members in managing CPR and thereby empower them. In addition researchers have been able to focus on key determinants of efficiently managed institutions as identified by Ostrom through the seven principles which means it has become easier to target and influence specific actors for optimal results. Finally, Ostrom research findings serves an important function of charting the right course that future research on CPR study and understanding institutions should take in order to enhance the current understanding and theories on the subject. Nobody can fail to appreciate the profound impact of Ostrom’s work that remains relevant to various disciplines when looked from a general perspective and not realize it has been the product of many years of research that is still ongoing even as we speak.

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