Property Rights Structures and Environmental Resource Management

Topics: Common-pool resource, Tragedy of the commons, Property Pages: 58 (21355 words) Published: February 15, 2013

Bhim Adhikari Environment Department The University of York Heslington, York YO10 5DD United Kingdom E-mail:

A Discussion Paper Prepared for the Beijer Institute Advanced Workshop on Property Rights Structures and Environmental Resource Management Durban, South Africa, 28-30 May 2002

This paper is based on a chapter from my progressing doctoral dissertation in Environmental Economics and Environmental Management at the University of York, England. Thanks are due to Jon Lovett, Doriana Delfino, Charles Perrings, N.S. Jodha, and Priya Shyamsunder. Comments on proposal and earlier version of this paper from participants of SANDEE’s research and training workshop and Beijer Institute’s advanced workshop on property rights structures and environmental resource management are also highly acknowledged. The research received generous financial support from the South Asian Network for Development and Environmental Economics (SANDEE). The usual disclaimers apply.


The relationship between socio-economic heterogeneity and distributional implications of community-based resource management is becoming a growing concern in issues of local level collective action. This study tries to examine the contested role of heterogeneity and equity of resource distribution in community-based property rights regimes in reference to community-based forest management in Nepal. The analysis is based on field data from 309 households from the mid-hills of the country to investigate stockholder’s incentives in common property forest management. The analysis of household level benefits from community forestry suggests that poorer stakeholders are currently benefiting less from community forestry than relatively better off households. This paper also develops a regression model of determinants of household level income from community forests. Econometric results show that some socio-economic variables of the resource-using group place stringent limits on the extent to which certain groups are able to again access to and benefit from collective action. I reconsider the issue of persistent socioeconomic inequality in communities and argue that restricting the access of poor people through changes in property rights structure in common-pool resources is likely to increase the level of poverty unless specific measures of compensatory transfer schemes are in place to safeguard the interests of the most vulnerable section of the community. At a glance, the impact of common property forest management seems to be ambiguous. While community forestry seems to be good for the forest resource itself and local environment, fundamental questions remain about the equity, distribution and livelihood implications of community property resource (CPR) institutions. I argue that clearly defined common property rights on common-pool resources are a necessary but not sufficient condition for equitable resource use. Property rights on natural resources need to be combined with social goals for equity, efficiency and the ecology of environmental resilience. The results show that transaction costs of community-based resource management can be a significant part of resource management costs, which is generally ignored in economic analysis of participatory forest management. Key words: property rights, heterogeneity, community forestry, forest user groups, transaction costs

1. Introduction Development of local economy while managing common pool resources has become an integral part of sustainable development policy in the past few years. This initiative has emerged largely due to a strong disillusionment with the performance of the centralized management policy to provide sufficient incentives to the resource users to manage local resources on a sustainable basis. It is argued that organised...
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