Providing and producing public goods and common-pool resources at local, regional, national and international levels require different institutions than open, competitive markets or highly centralized governmental institutions. If we are to solve collective-action problems effectively we must rethink the way we approach market and governmental institutions. We need analytical approaches that are consistent with a public sector that encourages human development at multiple levels (Opschoor 2004). This chapter reviews studies of polycentric governance systems in metropolitan areas and for managing common-pool resources. Hans Opschoor has devoted his academic career to the study of economic instruments and institutions related to development of and to coping with environmental problems. A fundamental set of problems facing individuals in all developed and developing societies are collective-action problems. The size and shape of these problems however differ dramatically. Polycentricity may help solve collective-action problems by developing systems of governmental and nongovernmental organizations at multiple scales. After an introduction to the problem, this chapter will review the extensive research that demonstrated the capabilities of many citizens to design imaginative and productive ways of producing public goods and common-pool resources. Successful systems tend to be polycentric with small units nested in larger systems. Not all such systems are successful, and we need to understand factors associated with failure as well as success. The last section of the chapter will discuss design principles that can help guide the design, adaptation and reform of governance systems to achieve robust and effective systems over time.
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