1Endogenous Provision and Appropriation in the Commons1 by

I. Determinants of provision and appropriation When a resource is under common property, access is restricted to members of the community, creating the potential of avoiding the tragedy of the commons that characterizes resource use under open access (Bromley). Serious difficulties remain, however, in managing the resource in a way that is socially optimum because of the rival nature of appropriation by individual members. Achieving the social optimum requires either inducing a non-cooperative behavior by individual members that mimics what cooperative behavior would dictate, or inducing cooperative behavior. A number of set ups have been identified where the first holds, for instance when the payoffs correspond to a chicken game, an assurance game, or tit-for-tat, or the Folk Theorem in repeated games (Bardhan, 1993; Nugent, 1993). There is a vast qualitative literature on the determinants of cooperation, with some success stories but also many failures (Wade, 1987; Ostrom, 1992). If, in addition, cooperation is costly, socially optimum resource use may deviate from the first best costless cooperative solution to an extent that reflects the importance of these costs (see section III below). Hence, even when there is cooperation, observed resource use relative to the costless social optimum appears as if there were different qualities of cooperation in communities characterized by differential costs of cooperating. If we are advocating cooperation as a solution to misuse of common property resources (CPR), we consequently need to develop models that can explain why we observe these presume