Tragedy of the Commons and Evolutionary Games in Social Networks: The Economics of Social Punishment

69 Pages Posted: 11 Jul 2017

See all articles by Jorge Marco

Jorge Marco

University of Girona

Renan-Ulrich Goetz

Universitat de Girona

Date Written: July 7, 2017

Abstract

This study revisits the problem of the tragedy of the commons. Extracting agents participate in an evolutionary game in a complex social network and are subject to social pressure if they do not comply with the social norms. Social pressure depends on the dynamics of the resource, the network and the population of compliers. We analyze the influence the network structure has on the agents’ behavior and determine the economic value of the intangible good - social pressure. For a socially optimal management of the resource, an initially high share of compliers is necessary but is not sufficient. The analysis shows the extent to which the remaining level of the resource, the share of compliers and the size, density and local cohesiveness of the network contribute to overcoming the tragedy of the commons. The study suggests that the origin of the problem – shortsighted behavior - is also the starting point for a solution in the form of a one-time payment. A numerical analysis of a social network comprising 7500 agents and a realistic topological structure is performed using empirical data from the western La Mancha aquifer in Spain.

Keywords: Tragedy of the Commons, Cooperation, Evolutionary Game, Social Network, Social Punishment

JEL Classification: C71, D85, Q25

Suggested Citation

Marco, Jorge and Goetz, Renan-Ulrich, Tragedy of the Commons and Evolutionary Games in Social Networks: The Economics of Social Punishment (July 7, 2017). FEEM Working Paper No. 35.2017. Available at SSRN: https://ssrn.com/abstract=2998546 or http://dx.doi.org/10.2139/ssrn.2998546

Jorge Marco

University of Girona ( email )

Girona, 17071
Spain

Renan-Ulrich Goetz (Contact Author)

Universitat de Girona ( email )

Girona, 17071
Spain
+ 34 972 418236 (Phone)
+ 34 972 418032 (Fax)

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