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Elinor Ostrum on "the Prisoner's Dilemma"

From Ostrum's Nobel Lecture, which is dense but fast-moving and well worth reading and study:

The classic assumptions about rational individuals facing a dichotomy of organizational forms and of goods hide the potentially productive efforts of individuals and groups to organize and solve social dilemmas such as the overharvesting of common-pool resources and the underprovision of local public goods. The classic models have been used to view those who are involved in a Prisoner’s Dilemma [PD] game or other social dilemmas as always trapped in the situation without capabilities to change the structure themselves. This analytical step was a retrogressive step in the theories used to analyze the human condition. Whether or not the individuals who are in a situation have capacities to transform the external variables affecting their own situation varies dramatically from one situation to the next. It is an empirical condition that varies from situation to situation rather than a logical universality. Public investigators purposely keep prisoners separated so they cannot communicate. The users of a common-pool resource are not so limited.

When analysts perceive the human beings they model as being trapped inside perverse situations, they then assume that other human beings external to those involved – scholars and public officials – are able to analyze the situation, ascertain why counterproductive outcomes are reached, and posit what changes in the rules-in-use will enable participants to improve outcomes. Then, external officials are expected to impose an optimal set of rules on those individuals involved. it is assumed that the momentum for change must come from outside the situation rather than from the self-reflection and creativity of those within a situation to restructure their own patterns of interaction.

So, whenever you hear an analyst or expert, especially an economist, invoke the Prisoner's Dilemma, you might ask yourself:

1) Whether the key assumption -- that game participants cannot communicate -- is realistic*, and

2) Whether the analyst or expert is personally invested in the "optimal set of rules" they will seek to impose on you (and people like you).

Indeed, considered in this light, "rationality" looks an awful lot like mere compliance.

Ostrum's Prisoner's Dilemma takedown -- at least in the realm of common pool resources -- is important because PD is so ubiquitous. [And, alas, I have to break off writing here, having simply asserted that ubiquity! --lambert]

NOTE * Hilariously, some German social scientists thought to actually -- quelle horreur -- test PD empirically, and PD breaks down, exactly where Ostrum identified its vulnerability:

For six decades, the classic cooperation test known as the prisoner’s dilemma has been a mainstay of graduate courses on game theory and behavioral economics, not to mention in Hollywood detective series.

Until recently, no one thought to test the game on actual prisoners.

A pair of German economists offered female prisoners a chance, and found they were more likely to act in cahoots than shaft the other prisoner, compared with female students in a control group, according to a study published in the August edition of the Journal of Economic Behavior & Oraganization.


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quixote's picture
Submitted by quixote on

Exactly. The assumption that people don't communicate runs all through economics. (I mean, just consider the "rational consumer" model that has no space for herd mentality.) It's a bit like having a theory of electromagnetism but ignoring magnetism. Makes the whole thing much stupider than it needs to be.

The history of science reason for it is that Adam Smith, who was an outstanding theorist, don't get me wrong, worked udring the time when Boyle's Gas Laws were all the rage. The idea being that everything would shortly be explained by the interactions of things -- atoms, billiard balls, people -- pinging off each other predictably once you understood the few major physical forces acting on them.

The part I don't get is why the model lasted longer than about the five minutes it takes to see that it leaves out most of the game changers. Like communication.

Peter L.'s picture
Submitted by Peter L. on

Since reading about Ostrom on Naked Capitalism, I've been enjoying finding out more about her work. It has been, so far, very refreshing, a bit like reading Steve Keen's Debunking Economics, and Minsky's work on banking and finance. Evidently, I like economics literature that tries to acknowledge the real world.

I really have a lot to learn about Ostrom's work, so here I just want to make a few naïve observations, and raise some questions that I'm interested in studying further.

1. I am again astounded by the shallowness of neo-classical economics. As with the prisoner's dilemma, Ostrom has also explained the serious limitations of the “tragedy of the commons” argument. She notes that it takes a very specific set of assumptions to get the “right” result. Like the prisoner's dilemma the users of the commons must not communicate with one another. When they can, not surprisingly, the results are different. Ostrom doesn't argue that the tragedy of the commons problem is completely invalid, but she does explain why, in the real world, it will only apply in very specific situations that cannot be expected to apply in general. (Another assumption needed for the tragedy of the commons example to “work” is that the shepherds exploiting the common pastures must be able to successfully identify and retrieve the animals that they add to their herds. Of course that's important, as it is obvious! And I must say, I wonder what it says about me that I never thought of it when confronted by the tragedy of the commons, which more-or-less made sense to me before now.)

2. As mentioned by Strether in another post, understanding the diversity of rules systems (for handling management of resources) seems like a key part of Ostrom's work. I notice in her talks, many good ones available on YouTube, that she, again and again, emphasizes the importance of recognizing the complexity of circumstances that lead to, or don't, effectively managed resources. There are, according to Ostrum, some ways of classifying and systematically dealing with rules systems, but there doesn't look to be any way to find a generally effective method for managing resources that can implemented without detailed understanding of the particular circumstances.

3. Related to point one, I would add to Strether's suggestion that anytime the prisoner's dilemma is invoked to explain something, one not only ask about communication between participants, but every reasonable real world variable that could affect behavior. For instance, is there a culture of solidarity among the prisoners?

1. Has anyone looked at Peter Linebaugh's work on the Magna Carta? Ostrom discusses access to, and preservation of commons from outside groups. Evidently, the Charter of the Forest, a companion to the Magna Carta, can be considered an early basis of law that did just this, namely protected the commons from the king, and from privatization. Apparently, Linebaugh has done extensive work on this issue. I'd love to know what people think about it. (Linebaugh uses a nice quote to the effect of: the law locks up the woman who steals a goose from the commons, but protects the greater criminal who steals the commons from the goose.)

2. A bit silly: does the phrase “common people” originate from a meaning like, “people who use the commons,” and similarly, what relationship does the term “common law,” as in our Anglo-American law, have to “the commons”? And of course “common sense”?

Looking forward to discussion of Ostrom's work.

Submitted by lambert on

.... is something I'd like to know more about. Here's the P2P Foundation entry. Here's a 2003 article by Linebaugh, The Secret History of the Magna Carta. I'm not sure how to excerpt it, but this passage caught my eye:

The wooded pasture is a human creation, the result of centuries of accumulated woodmanship, carefully planned so the same land could be used for trees and grazing animals. Coppice (trees like ash and elm that grow again from the stump) provided an indefinite succession of crops of poles (for making rakes, scythe-sticks, surplus used for stakes and firewood); sucker (trees like aspen and cherry that grow again from the root system) formed patches of genetically identical trees called clones; and pollard (trees that are cut six to 15 feet above the ground, leaving a permanent trunk called a bolling), sprouted like coppice stool but out of reach of the livestock.6

In Anglo-Saxon times wooded commons were owned by one person, but used by others, the commoners. Usually the soil belonged to the lord while grazing belonged to the commoners, and the trees to either. Whole towns were timber-framed. The strut and beam of cottages, the curved wooden rafters, the oak benches of worship. Wheels, handles, bowls, tables, and stools were wood. Wood was the source of energy.

That reminds me very much of "Amazonia" as described in 1491, and edible forests generally. One wonders if the English optimized the soil as well. If the forests had nuts and fruit, as they surely did, they were very edible, too....

And here's a review of his book:

Linebaugh reminds us that Magna Carta was one of two documents constituting the Great Charters of Liberties of England. All but unknown today, the Charter of the Forest established commoning. Whereas Magna Carta provides the basis for due process, trial by jury, and prohibition of torture, for example; the Forest Charter established the commons and defined limits on privatization. The commons is “the theory that vests all property in the community and organizes labor for the common benefit of all” (p. 6). Together, then, the Great Charters “stipulated restraints upon the royal realm” and “provided subsistence in the common realm” (242). The two charters cooperate in that ”political and legal rights can only exist on an economic foundation” (6). Those familiar with Linebaugh’s prior books will appreciate here how he carries forward the tradition of his teacher, historian E. P. Thompson.

If Linebaugh studied under Thompson (see, Whigs and Hunters) say no more!

nihil obstet's picture
Submitted by nihil obstet on

The Prisoner's Dilemma describes the world that the powerful want. Rulers spend a lot of time and effort to prevent communication and sow distrust among the rest of us, particularly in our roles as workers. It's ideology masquerading as analysis.

Submitted by lambert on

One thinks of an Amazon warehouse.