The concept of “community-based” solutions to environmental problems should be attractive to both the Liberal Democrats and the Conservatives, given the former’s interest in decentralisation and the latter’s interest in free-markets.
What do community-based solutions to environmental problems involve? Professor Elinor Ostrom, the 2009 Nobel Prize winner in economics, gave us an insight last night at the IEA’s F. A. Hayek memorial lecture which was attended by about 600 people. There is some hard and abstract theory, but amidst that there are important principles that can be enacted in policy. It is a pity that the same intellectual effort is not put into examining how communities can manage their own environmental problems as has been put into, for example, Downing Street’s “Nudge” unit.
Ostrom’s ideas are designed to deal with “common pool resources” and the management of environmental problems. The basic idea is that the specifics of different problems are different along a wide range of dimensions but that the government often does best by setting general rules and allowing those who have an interest in solving the problem to design the specific rules and enforcement mechanisms.