will have heavy costs into the future, and we have to carefully balance the potential
gains from accelerated development (and consequent higher welfare) in the intermediate run against the admittedly highly uncertain penalties that will come in the
far future, on the unrealistic assumption that no improvements will take place in
technology (even new sources of energy, for instance).
2 Logic of Collective Action and Optimal
Country Strategy
Granted that we should be conscious of the limited capacity of the environment to
absorb our emissions and repair the damaging effects of excessive resource
extraction and unsustainable use, what should be our approach as a world community, and as an individual country? The global atmosphere (and climate) is like a
commons, with hundreds of independent countries, thousands of corporate and
other bodies, and billions of individual families. There is no mechanism to impose
the required controls on carbon emissions apart from a voluntary agreement. But,
here the “logic of collective action” comes into operation (Olson 1971). Even the
nation-state in modern times is not capable of supporting itself solely on voluntary
contributions, despite the strong emotional bonds that hold the citizens together,
and the benefits that they undeniably get in the continuance of the state structure;
the state has to impose compulsory taxes and collect them with a firm hand. This is
because, when there is a large multitude of members, no one of them can be
prevented from enjoying the benefits of the organization; hence there will be an
underlying incentive for the individual to withhold his or her individual contribution as far as possible, as long as it is reasonably certain that the contributions of the
myriad others will carry the organization forward. In fact, that would the rational
thing to do, even if not ethical or fair.
Another metaphor used to describe such situations is the “tragedy of freedom in
a commons” that Hardin (1968) talked about many decades back. The problem with
regulating use of a commons is that private costs and benefits are mismatched with
public ones: each person has to incur a private cost that may be substantial from the
individual point of view, but the collective benefits are enjoyed by everybody, and
moreover, the individual has little or no control on the actions of all the others, and
hence on the outcome. If the others choose to break the agreement and maximize
their private returns, our sincere individual may be left ‘holding the short stick’. No
one likes to be taken advantage of in this manner, so there is an in-built tendency
for a mismatch between public professions and actual behaviour, if the individual
feels that they can get away with it, or suspects that the majority of actors are
intending to take advantage. In simple terms, when there are large numbers of
actors, and where the benefits are collective, or public goods, and where no one
person could be excluded from enjoying those benefits, it would be the narrowly
rational choice for individuals to avoid, as far as possible, the incurring of costs on
Climate Change Strategies and Developing Nations …
31
gains from accelerated development (and consequent higher welfare) in the intermediate run against the admittedly highly uncertain penalties that will come in the
far future, on the unrealistic assumption that no improvements will take place in
technology (even new sources of energy, for instance).
2 Logic of Collective Action and Optimal
Country Strategy
Granted that we should be conscious of the limited capacity of the environment to
absorb our emissions and repair the damaging effects of excessive resource
extraction and unsustainable use, what should be our approach as a world community, and as an individual country? The global atmosphere (and climate) is like a
commons, with hundreds of independent countries, thousands of corporate and
other bodies, and billions of individual families. There is no mechanism to impose
the required controls on carbon emissions apart from a voluntary agreement. But,
here the “logic of collective action” comes into operation (Olson 1971). Even the
nation-state in modern times is not capable of supporting itself solely on voluntary
contributions, despite the strong emotional bonds that hold the citizens together,
and the benefits that they undeniably get in the continuance of the state structure;
the state has to impose compulsory taxes and collect them with a firm hand. This is
because, when there is a large multitude of members, no one of them can be
prevented from enjoying the benefits of the organization; hence there will be an
underlying incentive for the individual to withhold his or her individual contribution as far as possible, as long as it is reasonably certain that the contributions of the
myriad others will carry the organization forward. In fact, that would the rational
thing to do, even if not ethical or fair.
Another metaphor used to describe such situations is the “tragedy of freedom in
a commons” that Hardin (1968) talked about many decades back. The problem with
regulating use of a commons is that private costs and benefits are mismatched with
public ones: each person has to incur a private cost that may be substantial from the
individual point of view, but the collective benefits are enjoyed by everybody, and
moreover, the individual has little or no control on the actions of all the others, and
hence on the outcome. If the others choose to break the agreement and maximize
their private returns, our sincere individual may be left ‘holding the short stick’. No
one likes to be taken advantage of in this manner, so there is an in-built tendency
for a mismatch between public professions and actual behaviour, if the individual
feels that they can get away with it, or suspects that the majority of actors are
intending to take advantage. In simple terms, when there are large numbers of
actors, and where the benefits are collective, or public goods, and where no one
person could be excluded from enjoying those benefits, it would be the narrowly
rational choice for individuals to avoid, as far as possible, the incurring of costs on
Climate Change Strategies and Developing Nations …
31