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It is
something of an understatement to say that the Covid-19 pandemic is shaking
everything up and
will have an ongoing legacy. This is nothing new, the history
of pandemics suggest they can have a significant and long lasting impact on
society and the economy[1].
The
immediate and longer term consequences of the current pandemic are, and are
likely to be, largely negative. However, there are also some positive stories
emerging from the upheaval and suffering. A recent article[2]
highlights some of the many initiatives around the world where communities and
groups are coming together to organize themselves and offer support and help to
others. It will be interesting to see how many seeds are planted during the crisis
that will continue to bear fruit once it has passed.
Many of
these projects are a form of ‘commons’ - neither state or market led - a way of
organization that waned with the enclosure of land and the development of more
private property (and state regulated) based economic systems.
However,
commons haven’t disappeared completely, there are still some notable and
longstanding examples, such as cattle herders in the Alps, along with some
newer models of commons based peer production, such as that involved in Linux
open source software, Wikipedia or the Firefox browser.
Alongside commons based models these has been increasing attention
recently on other approaches, which can operate in market based economies, yet
broaden stakeholder involvement. These include cooperatives, employee ownership,
community wealth building and ‘B-corps’. The wider inclusiveness of these types
of organisations give more people a stake in the organisation and an incentive
to be innovative and improve performance.
A commons
approach is a shared endeavor to collectively develop, organize and manage
resources. The often cited risk with this approach is that it results in what
is known as the ‘tragedy of the commons’[3].
Where this occurs insufficient or ineffective communication and management results
in overuse and degradation of resources. This results from individual short
term advantage, or fear of loss overwhelming the wider collective (and eventually
individual) good in a version of the ‘prisoners dilemma’[4].
Private
property rights are seen as one answer to this ‘tragedy’. The argument being
that an owner will look after their own property, and they will have an
incentive to invest, innovate and improve. The risk with this approach is that
private owners might well ignore ‘externalities’ that fall onto the wider
society, such as the costs of pollution and might focus on short term returns
at the expense of stewardship for future generations. A further consequence of
this approach is that returns on investment tend to become more concentrated
among property owners with society becoming more unequal and less ‘inclusive’.
Perhaps ‘externalities’
were seen as less of an issue when the earth’s resources and capacity for waste
appeared to be inexhaustible – we now know this is very far from the case as
current developed country ways of living consume and despoil the resources of
multiple planets.
‘Tragedies
and externalities’ are both types of collective action problems, where social
and private interests are not aligned. Something similar is observed in the
natural world, when an animal seeking relative advantage can undermine the
common good.[5] However,
humans have the ability to communicate, reason and plan to overcome these types
of problems. Humankind’s capacity to cooperate is critical to solving these
problems. Although history is littered with examples of societies that have
been unable to sustain themselves as a result of a failure to do this.[6]
The work of
Nobel Prize winning economist Elinor Ostrom[7]
offers guidance for managing a commons. From widespread study of different
commons, she identified a number of key features, including, clear
communication, user defined rules, graduated sanctions where rules are broken
and low cost dispute resolution processes.
In market
based economies democratically agreed laws, regulation and taxes, alongside
more informal social norms, are all used to address externalities and mediate
the interests of the individual and society.
The
relationship between the private and the social is a fine balance - the current
‘liberate’ protests in the US are a case in point. The balance varies between
cultures, driven by history, environment and philosophy. This is highlighted by
Julian Baggini in his review of different world philosophies[8] -
from the eastern emphasis on the harmony of society to the western focus on individual
liberty. He concluded that: “Values of
autonomy, harmony, community and individuality all have a legitimacy but there
is no way to live that allows us to maximise all of them. There is more than
one way for humans to flourish and trade-offs are inevitable.”
Managing
these trade-offs requires cooperation and understanding, which is hard enough
where there are shared values. At a global level it’s much harder, yet it is
even more critical as we wrestle with issues like Covid-19 and the climate
emergency. Although written almost 400 years ago ‘no man is an island’ has
never seemed more apt, with perhaps the amendment of one word!
When
multi-national co-operation works, as with the Montreal Accord on CFCs, it can be
transformative. However, achievements of this scale are few and far between and
hard to pull off, particularly when short term domestic political pressures
bear down on decision makers.
What will
be the impact of the Covid pandemic on cooperation to solve collective
problems? A paper written last year Alex Evans[9]
explored what’s needed to rebuild political common ground. This suggests it
could go one of two ways. On the one hand there is the danger that it could
exacerbate polarisation and division within and between countries, which have
been fueled by rising inequality, a breakdown in trust etc. On the other he offers
the hope that: “there is also
ample historical precedent to show that periods of crisis and turbulence can
provide highly fertile ground for non zero-sum cooperation, normative renewal,
and widely shared feelings of common identity and common purpose.”
The
pandemic has left many of us feeling somewhat disorientated. Acknowledging that
we are at a crossroads and learning the lessons from positive examples of
common endeavor might be the first steps in charting a way forward that turns hope
into reality.
[1] A
recent study for the Federal Reserve Bank of San Francisco, which looked at the
aftermath of fifteen pandemics since the 14th century, concluded
that the macroeconomic impacts persisted for around 40 years. https://www.frbsf.org/economic-research/files/wp2020-09.pdf
European Parliament Briefing on the economic impact of
pandemics https://www.europarl.europa.eu/RegData/etudes/BRIE/2020/646195/EPRS_BRI(2020)646195_EN.pdf
[3] Garrett Hardin - The Tragedy of the Commons (1968) http://www.sciencemag.org/content/162/3859/1243.full
[4] ‘a game … that shows why two completely
rational individuals might not cooperate, even if it appears that it is in
their best interests to do so.’ https://en.wikipedia.org/wiki/Prisoner%27s_dilemma
[5] A good example of this is the male peacock’s tail,
which helps each individual attract a mate and thus ensures the passing on of
his genes, but makes the species as a whole more vulnerable to predators. Robert
Frank - The Darwin Economy (2011) Princeton University Press.
[7] Elinor Ostrom - Governing The Commons: The Evolution
of Institutions for Collective Action (1990) Cambridge University Press.
[8]
“How the world thinks” – Julian Baggini (2018)
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