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9 J. Pol. & L. 64 (2016)
Confusions in the Anticommons

handle is hein.journals/jpola9 and id is 1214 raw text is: Journal of Politics and Law; Vol. 9, No. 7; 2016 ISSN 1913-9047 E-ISSN 1913-9055 Published by Canadian Center of Science and Education Confusions in the Anticommons Ronald F. King', Ivan Major2 & Cosmin Gabriel Marian3 1 Department of Political Science, San Diego State University, California, USA 2 Institute of Economics, CERS, Hungarian Academy of Sciences and Budapest University of Technology and Economics, Hungary 3 Department of Political Science, Babes-Bolyai University, Cluj-Napoca, Romania Correspondence: Ronald F. King, Department of Political Science, Nasatir Hall, San Diego State University, San Diego, CA, 92182-4427, USA. Tel: 1-619-594-1094. E-mail: rking@mail.sdsu.edu Received: March 5, 2016 Accepted: June 11, 2016 Online Published: August 30, 2016 doi:10.5539/jpl.v9n7p64 URL: http://dx.doi.org/10.5539/jpl.v9n7p64 Abstract Tragedy of the anticommons is the logical reciprocal to the better-known tragedy of the commons. It is generally characterized as a legal regime in which multiple owners hold rights of exclusion over a resource in demand. The resource cannot be put into use without a bundling of approvals from the various separate owners, yet bundling entails serious bargaining complications resulting in systematic Pareto underutilization. Nevertheless, we argue, the anticommons concept often has been employed without consistency and appropriate precision. Illustrations come primarily from the writings of Michael Heller, whose oft-cited work has been central to the anticommons literature. This paper presents a simple version of the formal anticommons model and demonstrates that relevant applications can be constructed with uniformity and analytic rigor. Keywords: anticommons, rational tragedies, segmented property rights, non-cooperative games, bundling failure 1. Introduction Tragedy of the anticommons has been the subject for dozens of academic papers, both analytic explorations and empirical applications. It is even the title of a punk rock song (Max Levine, 2010). According to Michael Heller, the scholar most responsible for developing and popularizing the term, anticommons is defined as a property regime in which multiple owners hold effective rights of exclusion in a scarce resource (1998, p. 668). The resource cannot be put into use without a bundling of approvals from the various separate owners, yet bundling entails serious bargaining complications resulting in systematic underutilization. Tragedy of the anticommons is conventionally contrasted with the more familiar tragedy of the commons, in which multiple owners of a scarce resource hold effective rights of use but not of exclusion, resulting in systematic over-utilization. Nevertheless, 'anticommons' has not always been applied with appropriate precision. Our goal in this paper is to save the concept, not to bury it. First, the notion of property, allegedly essential for the identification of legal regimes where multiple actors possess exclusion rights, is often stretched far beyond ordinary meaning. Although introduced haphazardly, this conceptual stretching, we argue, is not inherently implausible. Anticommons is more reasonably defined with minimum reference to legal property, as including all potential bundling situations comprised by separate, complementary, and necessary inputs. Second, anticommons illustrations in many cases have not been constructed with adequate attention to the strategic calculations of the actors and the logic through which inefficiency occurs. Far too often, it refers broadly to any occasion of multiple-actor bargaining failure, with little or no reference to the underlying causes. Whereas the first expansion of the anticommons concept can be justified, this second expansion cannot. While bundling of necessary permissions is regularly a problem in negotiations, there already exists sufficient language to describe most ordinary types of bargaining failure. Anticommons tragedy contributes to the law-and-economics literature on externalities by its identification of one particular game-theoretic situation, in which maximizing players achieve Nash equilibrium at less than Pareto optimal accomplishments. There are ample anticommons illustrations in the real world without having to muddle the discussion with other, vague and misleading characterizations. 64

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