Local Environmental Control and Institutional Crowding-Out

Posted: 22 Dec 2000

See all articles by Juan-Camilo Cárdenas

Juan-Camilo Cárdenas

Universidad de Los Andes

John Stranlund

University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics

Cleve Willis

University of Massachusetts Amherst

Abstract

Regulations that are designed to improve social welfare typically begin with the premise that individuals are purely self-interested. Experimental evidence shows, however, that individuals do not typically behave this way; instead, they tend to strike a balance between self and group interests. From experiments performed in rural Colombia, we found that a regulatory solution for an environmental dilemma that standard theory predicts would improve social welfare clearly did not. This occurred because individuals confronted with the regulation began to exhibit less other-regarding behavior and made choices that were more self-interested; that is, the regulation appeared to crowd out other-regarding behavior.

Keywords: institutional crowding-out; external regulation; local environmental quality; experiments; South America; Colombia

Suggested Citation

Cárdenas, Juan-Camilo and Stranlund, John and Willis, Cleve, Local Environmental Control and Institutional Crowding-Out. Available at SSRN: https://ssrn.com/abstract=252874

Juan-Camilo Cárdenas

Universidad de Los Andes ( email )

Carrera 1a No. 18A-10
Santafe de Bogota, AA4976
Colombia
339-4949 ext. 2473 (Phone)

John Stranlund

University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics ( email )

Stockbridge Hall
80 Campus Center Way
Amherst, MA 01003-9246
United States
413-545-6328 (Phone)

Cleve Willis (Contact Author)

University of Massachusetts Amherst ( email )

College of Food and Natural Resources 117 Stockbridge Hall
Amherst, MA 01003
United States
(413) 545-2766 (Phone)

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