The endogenous formation of common pool resource coalitions

We present the results of framed field (lab-in-field) experiments designed to investigate the endogenous formation of common pool resource (CPR) coalitions when the resource is co-defended with costly monitoring by coalition members and sanctions for encroachment imposed by the government. The experiments were conducted with fishers who were members of Chile's territorial use rights fisheries (TURFs) and in the lab with Chilean university students. Consistent with theoretical predictions, the fishers frequently formed CPR coalitions, even when they could not deter outsider poaching. When the cost of monitoring was low, fishers frequently formed the grand coalition. Coalitions tended to be smaller when monitoring was more costly, but not significantly so. However, coalitions were significantly smaller when monitoring was not available relative to when the cost of monitoring was low. Fishers also invested in monitoring frequently and these investments reduced poaching. When coalitions formed, total harvest effort was curtailed and earnings for coalition members generally increased. Students formed coalitions less frequently, these coalitions tended to be small, and they infrequently invested in monitoring, even when it was profitable to do so. Consequently, student coalition members were not better off on average than under open access.