Fall 1999 Colloquia

Colloquia during Fall 1999:


Monday, December 6, 1999

An International Collaborative Experiment in Knowledge and Information Exchange

Presented by Charlotte Hess, Director of Library and Information Services, Workshop in Political Theory and Policy Analysis, Indiana University, Bloomington



In July 1999 six members of IASCP (International Association for the Study of Common Property) traveled to Mozambique to participate in a workshop, a conference, and meetings with resource managers, government officials, university scholars, and indigenous communities. The IASCP group consisted of scholars from various disciplines, including political science, human ecology, forestry sociology, and information science. It was invited by the Mozambican Center for Forestry Research (CEF) with the funding of the Ford Foundation, in order to introduce common property theory and its application to Mozambique’s natural resource management challenges. CEF and Ford felt that bringing IASCP to Mozambique at this juncture would assist a wide range of policy formulation and program implementation activities. The Mozambicans also hoped that this interchange would strengthen the understanding of the outside world of their situation, as well as their challenges and achievements.

The first week took place primarily at an ecotourism lodge in Zonguene at the source of the Limpopo River. The two-day workshop began with a series of presentations by the IASCP group on the salient tenets of CPR theory. The conference that followed consisted of papers presented by many of the Mozambican participants covering areas of activity where CPR theory might enable a better understanding about strategies for the resolution of problems. The IASCP group served as commentators. The following week some of the IASCP group traveled further inland with CEF colleagues to the miombo woodland forests of west central Mozambique.

During this two-week period, over a hundred diverse people from various economic and professional sectors came together to exchange ideas about viable solutions for sustaining natural resources and local communities. Unanimously, participants felt that this innovative program of events was an overwhelming success.

As the information specialist of this group, I will discuss the approaches we developed to most efficiently and successfully exchange knowledge, experience, and ideas during this program. I discuss some of the complex dilemmas and challenges facing the Mozambicans. My main focus will be on the dilemmas of networking and information management and retrieval on an international scale. The experience has raised some fundamental questions about the structure of information: how we craft our information systems to allow for growth, interactivity, and sustainable development. In lieu of a paper, there is a web page with numerous slides and documents that may be previewed at


Monday, November 29, 1999


Presented by Juan-Camilo Cardenas, Ph.D. Candidate in Resource Economics at the University of Massachusetts/Amherst, and Visiting Scholar at the Workshop in Political Theory and Policy Analysis, Indiana University, Bloomington



This paper is about the role of poverty and inequality on communities trying to solve local commons dilemmas. The debate remains alive since Olson's (1965) argument that the privileged in a group facing a collective action problem may facilitate the provision of the public good despite the free riding of the poorer. Olson's hypothesis, however, has been contested by some arguing that inequality can create efficiency losses due to asymmetries of information, power or wealth , among others, which reduce the capacity of groups to achieve Pareto optimal equilibria. Experimental economics can and has been used to test with college students for these contrasting arguments. We expand the evidence by conducting a series of experiments in the field where the subjects are actual local commons users. We use additional information about the participants' real characteristics and test if such factors affected their behavior in the lab in a simple Common-Pool Resources experiment with groups of 8 people. We found that factors such as actual wealth and occupation do explain the rather wide variability on the level of cooperation achieved after allowing face-to-face communication before each round, for a sample of 10 groups. We first tested these hypotheses at group level finding that wealth and heterogeneity may be negatively associated with cooperation and efficiency. Then at a micro level we test and show that the individual is more willing to cooperate through face-to-face communication if (i) has a lower level of real wealth, (ii) her occupation is associated with local commons dilemmas, (iii) and is playing in a group where she shows lower social distance with respect to the other 7 players. The results could be relevant not only for the inequality-cooperation debate, but for the debate on the power of experimental economics to tackle these type of questions.

Copies of the paper in pdf format: Paper 


Back to index

Monday, November 22, 1999

A New Approach to Managing Health Care Financing

Presented by Roberta Herzberg, Director, USU Institute of Political Economy; Commissioner, Utah Health Policy Commission; Associate Professor, Department of Political Science, Utah State University



Ten years ago, health care analysts claimed that the orthodox model of managed care (HMO's and capitation) would emerge as the centerpiece of US health care. By 2000, it was expected that almost every citizen would be enrolled in a vertically integrated health care system, that costs would be managed, and health care quality could be improved. Large health networks competing on the basis of cost and quality were predicted to deliver on the promise of a market based system of health care.

Today, there are many indications that orthodox managed care is not the model for the future of health care. Rising health care costs after a period of cost restraint, hundreds of state and national bills to regulate managed care, and a decline in the market share of capitated health care systems suggests that this model may not be able to deliver on its original promise.

Professor Herzberg will show evidence that orthodox managed care systems are in trouble, outline why they are under fire and suggest what model of management might replace them. She suggests that capitation has had problems because it has tried to manage different forms of risk with a single set of instruments that are inadequate to the task. This mixing of risk has led to dissatisfaction for both patients and providers that has resulted in the political reforms in legislatures across the nation. She will outline an alternative model for managing health care costs, global pricing on an episode-of-care basis, in which different forms of risk are taken into account.

Bio: Roberta Herzberg, PhD, is Associate Professor of Political Science and Administrative Director of the Institute of Political Economy at Utah State University. Her areas of expertise include health care policy, American politics, Government and Business, Formal Choice Theory and Experimental Methods. She was appointed to The Utah Health Policy Commission by Governor Michael Leavitt in 1994 and continues to serve as Commissioner today. She serves as a Governor's appointee to the Utah Medical Education Council, and as a consultant for Health Insurance issues in Utah. She is a frequent speaker at national and state level meetings regarding health care financing issues.

A background paper entitled "The Political Economy of Capitated Managed Care" (The American Journal of Managed Care 3(3), March 1997: 396-417) is available at the Workshop. If you would like to be mailed a copy of Professor Herzberg's background paper or have a question regarding our Colloquium Series, please contact Gayle Higgins (tel 855-0441, email


Back to index

Monday, November 15, 1999


Presented by Robert Stein, Dean of Social Sciences, School of Social Sciences, Rice University, Houston, Texas (Paper Co-Authors: Martin Johnson and W. Phillips Shively)



Scholars have found the concept of attitude accessibility and its measure (i.e., latency) to be useful in explaining the strength of opinions and their influence on behavior (Huckfeldt et al 1999; Bassili, 1993). We employ the concept of accessibility as means of addressing a long standing problem in the study of the influence of context on individual behavior.

Contextual analysis has enriched political theory by studying the voter as more than an isolated individual making solely individual decisions. The circumstances under which individuals make their decisions, and the varied influences that work on them in their social environments, have come to the fore in contextual analysis.

However, two problems have dogged contextual analysis: the proper measurement of context, and the problem of selection bias in aggregation, which can create phantom "contextual effects" where none truly exist. We propose a strategy to improve the conceptualization and measurement of contexts. Further, by bringing the measure of context closer to the individual, the research design we offer provides a test for the problems associated with selection in aggregation. We propose that the effect of context on individuals can be identified with greater certainty by measuring the extent to which individuals are connected to their contexts, that is, by measuring the accessibility of context in decision-making.

We are interested in understanding the extent to which individual are tied to their environments. Specifically, what is the nature of the context-individual linkage to the person involved? How does it work? We contend that social context, or an evaluation of a social context, is embedded as an element in the cognitive structure an actor employs to encode and store information Thus, a person's perception of his or her context itself becomes an attitudinal construct. What we mean by connection to a context or the accessibility of a context is perhaps more easily understood with this model in mind.

We test our hypotheses with survey data collective on computer assisted telephone interviewing system in which latency measures are collected on number of different contextual conditions including, partisanship, racial environment and socio-economic milieu.

Copies of the paper in pdf format: Paper 


Back to index

Monday, November 8, 1999


Presented by Patrick Brandt, Graduate Student at the Department of Political Science, Indiana University, Bloomington



Research on presidential agenda setting and congressional-executive relations find little evidence of presidential influence on the legislative process. This result can be attributed to (1) theoretical ambiguities about the connection between preferences and policy outcomes and (2) empirical measures that fail to capture the strategic relationship between presidential proposals and policy outcomes. I review several spatial models with varying assumptions about complete and incomplete information that can be used to explain the outcomes of congressional-executive bargaining. Each of these models can be used to generate hypotheses about the effect of presidential actions on legislative choices and policy outcomes. Testing these hypotheses using a new data set of presidential budget requests and congressional budget appropriations reveals that an incomplete information spatial model best explains the policy outcomes. Further, the results indicate that presidential agenda setting and signaling have large effects on current congressional appropriations.

This paper is a chapter from my dissertation. While this paper does not fully derive and explain the formal models, the basic results are summarized and explained in the paper. This paper is meant to present an empirical test of which agenda setting model of congressional-executive relations applies to budget negotiations.

Copies of the paper in pdf format: Paper 


Monday, November 1, 1999


Presented by R. Maria Saleth, Associate Professor at the Institute of Economic Growth, Delhi, India, and Short-Term Consultant at The World Bank, Washington, DC (Paper Co-Author: Ariel Dinar)



This study develops an analytical framework to identify various layers of institutional inter-linkages and institution-performance linkages evident in the process of institution-performance interaction within water sector. The study then evaluates the layers of linkages using an evaluation methodology that uses perception-based cross-country data. Both these analytical and empirical analyses are then used to identify key inputs for developing a generic strategy for water institutional reform. Results provide several major insights: They indicate the relative strength, direction, and significance of the performance impact of institutional components and institutional aspects; they suggest clearly that the institution-performance interaction can derive from the general socio-economic, political, and resource-related environment within which such an interaction occurs; and they strongly favor a sequential strategy for institutional reform in general and for water institution in particular.

Executive Summary
Short Bio

A copy of the paper can be found on the World Bank's Water Resources Management website by clicking on the link provided below:


Back to index

Friday October 29, 1999

Sponsored by the Department of Political Science and Workshop in Political Theory and Policy Analysis


Presented by Itai Sened, Associate Professor at the Department of Political Science, Washington University-St. Louis



Existing models of the state of nature fail to yield an acceptable explanation for the emergence of the civil state out of the state of nature. Rousseau admits this flaw in the opening line of The Social Contract (1968 [1762]): "Man was born free, and he is every where in chains. . . . How did this transformation come about? I do not know. How can it be made legitimate? That question I believe I can answer." In this paper, I present a model of the state of nature that allows me to derive a social contract as a core agreement that emerges spontaneously out of the state of nature game. In future research, I intend to use this initial stable core point to outline the evolution of the social contract using existing neo-institutional game theoretic models.

A copy of his paper entitled "A Simple Model of the Origin of Social Contracts" is available at both the Workshop and the Department of Political Science. His paper will not be published on our website. If you would like to be mailed a copy of the paper, please contact Gayle Higgins (tel 855-0441, email


Back to index

Monday, October 25, 1999


Presented by John Witte, Director of the La Follette Institute and Professor of Political Science and Public Affairs, The Robert M. La Follette Institute of Public Affairs, University of Wisconsin-Madison



This chapter from Professor John Witte's soon to be released book on the Milwaukee Parental Choice Program includes an analysis of the successes of targeting that program on poor students in need of alternatives to traditional public schools. He concludes that the program was successful in providing those opportunities and did not cream off the best students. The chapter also includes an analysis of the effects of the program on schools, parents, and student outcomes. Those outcomes demonstrate both "positive" and "negative" results.

A copy of his paper entitled "Outcomes of the Milwaukee Voucher Program," chapter 6 of his forthcoming book The Market Approach to Education: An Analysis of America's First Voucher Program (Princeton University Press) is available at the Workshop. His paper will not be published on our website.


Back to index

Monday, October 18, 1999

Application of Game Theory and Economics to Institutional Design in the Middle East

Presented by Edna Loehman, Department of Agricultural Economics, Purdue University, West Lafayette, Indiana; and Eythan Weg, Department of Psychology, Indiana University, Bloomington



This session will consist of two parts: game theory and economics of institutional design for water sustainability

Cooperation through Non-Cooperative Games

Eythan Weg, Indiana University, Department of Psychology

One basis for cooperation is self-interest (in the context of others) to increase directly consumable benefits, or utility. Classical game theory framed this in terms of characteristic functions (specifying the possible utility distributions for any coalition of players) as an abstraction of cooperative action. I will show an example where a group facing a risky environment-in a non-cooperative framework- chooses to cooperate. This choice is simultaneously Nash, Strong equilibrium (Aumann), and Pareto solution. I shall tie this framework to conflicts over water distribution in the Middle East as a prototypical application for our game-theoretic abstraction.

New Institutions and Pricing to Achieve Sustainability and Security

Edna Loehman, Purdue University, Department of Agricultural Economics
(Co-Authors of paper: Nir Becker, Eythan Weg, and Margaret Hendrickx)

We propose a regional cooperative water management system that combines aspects of a nonprofit regional utility and a representative governing body. Pricing and investment in water recycling are key economic tools for the regional utility to achieve sustainability. Temporal economic efficiency provides the conceptual basis for organization, pricing, and investment.

A representative body of water users would help the utility make acceptable management decisions and set limits on water use. Establishing limits on groundwater withdrawal consistent with safe yield would be sufficient to determine water prices through the balance of supply and demand. Investment in recycling is important to achieve sustainability and reduce price, and revenues from pricing would serve to cover investment costs.

Simulation modeling indicates that the price of water would initially be higher than the current price to reduce consumption to safe levels but then would reach a stable level, except for extreme drought conditions, as investment and groundwater storage increase over time. While a traditional market could improve spatial allocation, it would not necessarily address sustainability or provide for investment.

New work indicates that price need not be uniform, but can be personalized by use sector and increase with use, with a relatively low rate for an initial block. Thus, pricing that covers production costs can be made consistent with both equity and efficiency.

Copies of the paper in pdf format: Paper 


Back to index

Monday, October 11, 1999

When Common Property is Pareto Preferred to Private Property

Presented by Philip Powell, Assistant Professor at the Department of Business Economics and Public Policy, Kelley School of Business, Indiana University-Purdue University Indianapolis


Abstract: After resources are committed to a voluntary social arrangement, claim to theses resources is defined either by full private control, a property rights system that upholds private ownership at all points in time, or by full common control, a system that disallows unilateral private transfer of previously-owned resources out of the arrangement. When a social arrangement produces non-rivalrous benefits for its members and external benefits for the rest of society, full common control is Pareto preferred to full private control when Pigouvian intervention is unfeasible. Marriage contracts, religious congregations, and aboriginal land offer examples of the utility of this point in property law.

Copies of the paper in pdf format: Paper 


Back to index

Monday, October 4, 1999


Presented by John W. Maxwell and Thomas P. Lyon, Professors at the Department of Business Economics and Public Policy, Kelley School of Business, Indiana University, Bloomington


Abstract: The increased use of voluntary environmental agreements (VAs) in the United States in the early 1990's prompted a small but growing theoretical and empirical literature on their usage. The primary focus of this literature has been on the social welfare effects of VAs. As part of this focus, the extant literature on VAs offers explanations regarding why firms and regulators might desire VAs. However a careful reading of this literature reveals that most of the explanations are timeless, and therefore fail to explain the sudden emergence of VA usage in the United States.

This paper explains the emergence of VAs as a change in the American regulatory institution. We identify four groups powerful enough to be the agents of change in that institution: Industry, national environmental groups, the EPA and the Congress. Of these four, industry and the EPA hold the dominant position in writing VAs. We review US regulatory policy prior to the 1990s, and argue that a confluence of four "shocks" that arose from the mid to late 1980s set the stage for the adoption of VAs. The four shocks we enumerate are: mounting, complex environmental legislation; technological change and scientific discovery; budget cut backs at the EPA; and the rise of citizen law suits. We explain that these four factors altered the balance of power among the four groups mentioned above. In particular, both the EPA and industry found themselves in a less desirable situation. These facts caused the EPA and industry to attempt to rewrite the rules of the US regulatory institution in the form of VA adoption.

Our findings indicate that while VAs may be more efficient than the standard command and control regulation they hope to preempt, efficiency is not the primary motivation for VA adoption in the US. Consequently, even if it is true that VAs represent a more efficient form of environmental regulation there is no reason to believe they will come to dominate the US regulatory institution.

Copies of the paper in pdf format: Paper 


Back to index

Monday, September 27, 1999

Presentation will be held in the Workshop Seminar Room

Co-sponsored by the Microeconomics Workshop

Experimental Evidence

Presented by Claudia Keser, Professor at the Institute for Statistics and Mathematical Economics, Karlsruhe University, Germany, and Visiting Scholar at CIRANO, Montreal, Canada
(Paper Co-Authors: Siegfried K. Berninghaus and Karl-Martin Ehrhart)


Abstract: We present a series of experimental coordination games with a payoff-dominant and a risk-dominant Nash equilibrium. We examine in how far local interaction structures have effects on players' strategy choices. Our three major observations are the following: first, local interaction with open neighborhoods along a circle leads to less coordination on the payoff-dominant equilibrium than interaction in closed neighborhoods (see also Keser, Ehrhart, and Berninghaus, Economics Letters, 1998). Second, when players are allocated around a circle, the neighborhood size has, in the long run, no effect on the players' strategy choices. Third, with the same neighborhood size, players allocated on a lattice tend less than players allocated around a circle to coordinate on the payoff-dominant equilibrium. This is true although the players are given exactly the same instructions.

Copies of the paper in pdf format: Paper 


Back to index

Monday, September 20, 1999

Towards an Overall Analytical Framework

Presented by T. Manoharan, Visiting Research Scholar and Retired United Nations Economist (Copenhagen, Denmark)


Abstract: Common property is not an immutable concept interpreted abstractly. In the PRC, it is to be viewed in light of the organization of the economy as state sector, collective sector, and private sector. The Constitution and the 1986 General Provisions of Civil Law define the property rights of the state and collective sector and the rights of the private sector. Collective sector property, the user rights that go with it, come closest to what is generally perceived as common property. Such property is at the most decentralized administrative and territorial level, and is to be managed autonomously and directly through local entities. Of the three principal local natural resources (land, water resources for irrigation, forestry), a study of land management is taken up here as an illustrative case study in detail. Two overall considerations have been kept in view: collective sector management has to subserve the overall national plan objectives and efficiency in utilization of the resources has to be ensured through direct and indirect means. Given such overall requirements, the emphasis in this study is on the institutional framework and policy support for collective sector management.

Copies of the paper in pdf format: Paper 

Back to index

Monday, September 13, 1999

The Case of Irrigation in the Philippines

Presented by Yujiro Hayami, Professor of International Economics at Aoyama-Gakuin University, Tokyo, and Short-Term Consultant at The World Bank, Washington, DC
(Paper Co-Authors: Masako Fujita and Masao Kikuchi)

Abstract: Using the cross-section survey data on the activities of irrigators' associations in the Philippines, regression analysis is conducted to identify factors underlying the success and failure in farmers' organizing collective actions for maintenance and operation of gravity irrigation systems. It is found that collective action is difficult to organize where: (a) water supply is uniformly abundant, (b) water supply is greatly different between upper and lower streams in lateral, (c) size of association is large, (d) population density is low, (e) the ratio of non-farm households is high, and (f) the history of irrigated farming is short. The possibility is also found that these difficulties can be overcome with the adequate support of state agencies to promote community-level cooperation. The findings call for the government to play the active role of enhancing local communities' organizational capacity in the process of handing over to them the management of local commons.

Copies of the paper in pdf format: Paper 

Back to index

Monday September 6, 1999

Four Building Blocks for Interactive Family of Explanatory Theories
Presented by Elinor Ostrom, Co-Director of the Workshop and Arthur F. Bentley Professor of Political Science, Indiana University

Abstract: The paper presents an effort to provide a synthesis of the vast literature on collective action. Instead of continuing the effort to devise one theory of collective action, the paper argues that the phenomena involved are so diverse that a family of closely related theories are needed. To develop an explanatory theory, one needs to make crucial theoretical decisions about (1) the nature of the good involved, (2) the types of individual actors involved, (3) the attributes of the group involved, and (4) how rules affect incentives in collective action situations. Some of the resulting theories will predict zero or little contribution by participants to the provision of collective benefits and others will predict high levels of participation.

Copies of her paper in pdf format: Paper  Bibliography  Figures


Back to index

Back to the Workshop Homepage
Copyright 1998, Workshop in Political Theory and Policy Analysis
Last updated:  November 23, 1999