books economics

Book review: Elinor Ostrom’s Rules for Radicals, by Derek Wall

Elinor Ostrom was the first and so far the only woman to win the Nobel prize for economics*. She received the award in 2009 for her work on the commons. Ostrom died three years later, leaving behind a unique contribution to economics, and one that is highly relevant in an age of climate change and competition for resources.

Unfortunately, it’s never been very accessible. She wrote for an academic audience, and is not particularly quotable. Her books, many of which are out of print, have ‘not for the likes of you’ titles such as Crafting institutions for self-governing irrigation systems. Even her Nobel lecture, usually an opportunity to reach a wider audience, was titled Beyond markets and states: polycentric governance of complex economic systems.  Rarely have so many useful ideas been so hard to get hold of, and I’ve tried and failed to look into Ostrom’s work for myself.

So this is a book I’ve been waiting for: Elinor Ostrom’s Rule for Radicals, by Derek Wall. It draws on Ostrom’s scholarship across a variety of disciplines, and extracts useful lessons for those who want to make the world a better place.

The most important element of Ostrom’s work is her study of the commons. Garett Hardin had delivered what many felt was the last word on the subject in his famous 1968 essay The Tragedy of the Commons. Using the example of grazing cows, he argued that everyone following their own self-interest would always lead to over-exploitation of the shared resource. Any gain we can grab for ourselves comes to us alone, and any negatives are shared. Being rational maximisers, we will take what we can, and thus the commons will be depleted and ruined. Using this argument, people have insisted ever since that commons should either be privatised or run by governments, as they are ultimately doomed.

Elinor Ostrom heard Hardin speak about the commons and was intrigued. While his logic was neat, she knew of several entirely functional commons, as it was something that her husband Vincent had been studying. Hardin’s was an elegant thought experiment, but he hadn’t looked at the real world. If he had, he’d have seen Swiss mountain meadows or Filipino irrigation systems that have existed as commons for hundreds of years. There are plenty of failed commons too, but the tragedy was clearly not inevitable. So what were the good ones doing? How can we build cooperative systems of governance to manage shared resources?

Through observation of successful and failed commons around the world, Ostrom drew up a list of principles for shared management. Open lines of communication is one of them. Getting people to write their own rules is another, along with effective monitoring and graduated sanctions for those breaking the rules. I might cover some of these in a later post, as they give us some clues for managing those things that we all share in common, such as the oceans or the atmosphere.

The climate is another chapter, with Ostrom’s call for a ‘polycentric approach’ to climate change. That’s an academic way of saying that action needs to be at every level, rather than putting all the emphasis on international agreements, or on government plans. She drew on a principle of indigenous American culture that seven generations ahead is the correct time frame to think about the future.

Derek Wall gives these topics a chapter each, and some will be more relevant to readers than others. I enjoyed the chapters on cooperation, ecology and democracy. I didn’t get so much from chapters on institutions or scientific methods, but each to their own.

This isn’t a popular guide to Ostrom’s work for everybody, it’s fair to say. It’s still quite academic, and it comes from a particular perspective. Derek Wall is a political economist and member of the Green Party. “My aim” he writes, “is to make her work accessible and show how those on the left, especially the ecosocialist left, can make productive use of her diverse and provocative thinking.”

Wall is careful to point out that Ostrom herself was not of the left, and was a free thinker who can’t really be pigeon-holed. She was above all a pragmatist, interested in solutions to problems rather than ideological positions. Others might draw out different lessons and write very different books. Indeed they should, and I will read them too, because Ostrom was clearly a wise, complicated, curious and compelling character who deserves wider attention.

*or The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, to give it its proper name, as it’s not an actual Nobel prize. For those counting, Ostrom is the one woman out of 79 laureates. There’s also one black British man and Indian economist Amartya Sen, and otherwise white men all the way down.


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