Intergroup cooperation prevents resource exhaustion but undermines intra-group cooperation in the common-pool resource experiment

Abstract

Can intergroup cooperation over resources help prevent resource exhaustion and mitigate effects of climate change? How does resource uncertainty affect inter- and intra- group cooperation over resources in the common-pool resource dilemmas? I present experimental evidence from a mixed design experiment with two-between-groups factors: (1) the availability of intergroup sharing in which subjects can decide whether to give up some of their harvests to augment the resource stock of another group; (2) the presence (or absence) of shocks that can destroy a part of resources; and with one within-groups factor (41 replications). We present the evidence that random shocks encourage resource conservation. In addition, we find that intergroup cooperation is frequent. Many groups establish reciprocal exchanges of resources, which reduces the probability of resource exhaustion. The possible explanation of the high frequency of intergroup sharing in my sample is inequality aversion and reciprocity. Such reciprocal exchanges turned out to be successful in preventing resource collapse in the absence of shocks. However, the data I present show the dark sides of intergroup sharing. Subjects, who shared resources with the outgroup, harvested more for themselves following the donation. Moreover, under uncertainty, a combination of shocks and sharing made subjects overharvest resources.