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Social Dilemmas in Environmental Economics and Policy Consideration: A Review

Nicola Cerutti

Abstract


Many crucial environmental issues lead to social dilemmas, in which the
personally optimal solution, and the socially optimal solution diverge. Finding
a solution to this dilemma is extremely important to allow a good and
sustainable management of many exhaustible natural resources. This is
especially true when the resource users need to develop collectively a set of
rules or practices, and the institutions are unable to provide, or enforce,
effective regulations. A few examples are forests, and fisheries, but also carbon
emissions. This review presents a selected number of results coming from field
observations, laboratory experiments, and theoretical work, which pinpoint
some of the more crucial aspects of these decision environments. Knowing
which incentives and situational aspects may motivate resource users to adopt
a more or less cooperative behavior can potentially be of pivotal importance to
develop effective policies and regulations. At the same time, the research we
present is also of great interest for any diagnostic or explorative study that aims
to study direct resource users, and their development of cooperative attitudes
and practices.

Keywords


Decision theory, environmental economics, social dilemmas, resources, experiments

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