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Climate Change

The Ultimate Tragedy of the Commons?

Jouni Paavola

November 2011, English

In this paper, Jouni Paavola investigates the potential of institutional diversity and polycentric governance to deal effectively with climate change. Starting with the recognition that top-down governance solutions are a “false panacea,” Paavola observes that although climate change is, indeed, a global commons problem, that does not necessarily mean global governance is the most effective or efficient way of dealing with it. Indeed, the global regimes that have been created so far-the United Nations Framework Convention on Climate Change and the Kyoto Protocol-have made scant progress in reducing emissions of greenhouse gases (GHGs). Consequently, Paavola considers the extent to which regional, local, sectoral, and other partial or smaller-scale approaches to climate governance might speed progress on reducing anthropogenic GHG emissions.

He considers whether the best approach is not to set collective goals at a high level of governance, but to establish mechanisms for achieving such goals at lower levels. On the basis of two streams of the broader governance literature-new institutional economics (growing out of Coase’s work[1937; 1960]) and polycentric governance (stemming from V. Ostrom, Tiebout, and Warren [1961])-Paavola suggests that smaller-scale efforts to reduce GHG emissions might prove more effective than global governance by minimizing the costs of achieving collective action, for example, by reducing incentives to free ride. He examines two small-scale, purely voluntary initiatives: Cities for Climate Protection and the Cement Sustainability Initiative.

Although he finds such initiatives valuable, he admits that they are likely to realize only GHG emissions reductions that lead to (private) cost savings. Because GHG emissions need to be cut significantly by the middle of this century to stabilize the climate, he realistically notes that conventional state-based solutions retain a vital role. However, the contribution of voluntary, bottom-up, small-scale emissions-reduction programs should not be underestimated. Indeed, Paavola believes that such voluntary programs will proliferate as state-level climate regimes are implemented, suggesting a synergistic effect between levels of polycentric governance.

This paper was presented at the Lincoln Institute’s conference entitled “Evolution of Property Rights Related to Land and Natural Resources” in 2010 and is Chapter 14 of the book Property in Land and Other Resources, edited by Daniel H. Cole and Elinor Ostrom.