Economic impact of Collective Action
Economic models have been used to explain the problems that the world as a whole, Governments, communities and individuals face when attempting to achieve collective benefit from economic actions. The central problem to collective action is spell out by Elinor Ostrom in Governing the Commons: The Evolution of Institutions for collective Action. Elinor Ostrom’s main idea on governing the commons is when she says “I would rather address the question of how to enhance the capabilities of those involved to change the constraining rules of the game to lead to outcomes other than remorseless tragedies”. In this regard this paper support these proposition and will seek to spell out the impact of this proposition (collective action).
I do support this idea because Control by the user community of common good works better than external intervention. The impacts of adopting collective action is the possibility of tackling efficiently local issues by locals as is being put forward by Elinor Ostrom. In many cases central governments have increasing difficulties in tackling local issues and cannot find a viable solution for local problems, while through collective action it is possible to implement strategies tailored to local problems since it allows greater flexibility, responsiveness and local relevant. This idea has also been supported by (Davies et al, 2004) when he proposed that civil society associations are the typical initiators of innovative development steps and their involvement usually contributes to the greater extent to the success of local initiatives. Community mobilization allow Groups of individuals to informally work together to foster cooperation.
(World Bank, 2004) 'a collaborative and sustained process of cooperation amongst stakeholders increases the impact and credibility of individual action, brings vulnerable individual players into an alliance of like-minded organizations and levels the playing field between competitors.’ This shows that everyone in the business setting should always act as a guard to what the other individual is doing. Everyone has the right to stand up and say this is wrong rather than to watch when something wrongs is happening or being imposed by the Central Government.
However, despite the advantages of Elinor’s proposition there are also dangers associated with the implementing this concept. The major drawback to the successful implementation of the concept is free rider problem (Free rider is the situation where some individuals in a population either consume more than their fair share of common resource or pay less than their share of the cost of the resource) For example demonstration (collective action) against higher tuition fees at a school, even those that did not take part in the demonstration will benefit from the low tuition fees.
Under free-rider problem in the real economy self-interest overrides group interest for example why vote when a winner will be elected anyway. Despite some other people not casting their votes during the Election Day, the winner will always be declared despite others not voting. The concept of collective action is hard to do in practice, cultural and social pressures often make it difficult to either speak out or take action against others.
For example if a company was engaged in fraudulent activity, everyone in that company could be held accountable, this assumes that all members of that company actually knows what's going on and have chosen to either ignore or tolerate it. Therefore if this principal is taken to the extreme the post room worker is as much to blame as the CEO. However, despite these pros and cons there are solutions that policy makers should implement as a solution to the collective action problem Government regulation: A government can declare it against the law to act selfishly and require individuals to cooperate, For example the government introducing speed limits in the public roads anyone found to be going against this will be charged, this will force people to act accordingly. Privatisation: If someone owns a resource, then he or she can restrict access to it. Furthermore, it will be in his or her interest to prevent the resource from collapsing. The government must privatise the ownership of grazing lands so that grazing within certain areas is controlled so as to ensure sustainable and efficient use of resources.
REFERENCE
1. Bandiera,O. , Barankay, I., Imran, R. (May 2009): Social Incentives in the Workplace. Department of Economics, London School of Economics and Political Science, Houghton Street, London.
2. Olson, Mancur (1971). The Logic of Collective Action- Public Goods and the Theory of Groups, USA. Harvard Economic Studies.
3. Olson, M. (1965), The Logic of Collective Action, Harvard, Cambridge, MA.
4. WB (2008), Fighting Corruption Through Collective Action, A Guide for Business, The World Bank, available at http://[->0]i[->1]nfo.worldbank.org/etools/antic/Guide.asp.
5. Reuben, E. (2003), The Evolution of Theories of Collective Action, Master’s Thesis, Tinbergen Institute, available at http://www.ereuben.net/research/MPhilThesis.
6. Frohlich, N., Hunt. T.. Oppenheimer. N. A Wagner. R. H. 1975. Individual contributions for collective goods: alternative mod- els. J. Coiflict Resolutiorl 19:31&29

[->0] - http://i/
[->1] - http://i/