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Social-Ecological Systems Meta-Analysis Database: Theory

Market-driven resource decline

Variable relationship:

Integration into regional, national and global markets (Markets; Market Scale) can provide strong incentives (Resource Market Value) for exploiting resources more heavily, and can breakdown or undermine customary or local management institutions. In review of design principles and examination of factors that affect success in community-based natural resource management (Commons Condition Trend), Cox et al. (2010) conclude:

"External socioeconomic factors are particularly emphasized. Tucker (1999) and Tucker et al. (2007) stress that market integration can lead to rising inequality or declining resource (forest) conditions. Bardhan (2000: 861) finds that 'cooperative behavior in an irrigation community is by and large significantly related negatively to... urban or market connections.' Some authors such as Klooster (2000) argue that development and market forces can destabilize CPR arrangements that worked well when the community and resource were isolated. In an analysis of factors affecting overfishing in smallscale coral reef fisheries in Papua New Guinea, Cinner and McClanahan (2006: 78) find suggestive statistical evidence that 'communities in close proximity to markets had likely overfished the higher value and high trophic level species.'

In the context of forests, the role of roads in facilitating market access is often emphasized: as Agrawal and Yadama (1997: 436) state:

"Assessments of the relationship between increasing marketization and environmental degradation are similarly, and usually, negative. If local economies are integrated into larger markets, greater market pressures are presumed to lead to higher rates of deforestation. The role played by roads and better transportation links is viewed as critical in this regard."

Because roads are not essential to this theory, they are not included as a variable.

Scientific Field
Component Type(s)
Natural Resource Unit


VariableRoleRole ExplanationValue
MarketsProximate independent variableWell-articulated markets for goods produced by or associated with this resource will normally increase exploitation.Present
Transaction costsModerating independent variableLow transaction costs facilitate market-based transactions.Low
Market scaleModerating independent variableThe larger the scale at which markets for this resource operate, the less connected the market is with local resource use dynamics and the higher the risk is that demand driven resource exploitation reaches usustainable levels.Large in scale (e.g. international)
Resource market valueModerating independent variableThe higher the market value (i.e.price) of the resource the higher the incentive to exploit it.High
Commons condition trendFinal outcomeOver-exploitation will lead to a declining trend in resource condition.Worsened

Related Theories

TheoryRelationshipCharacterizing Variables
Marginalization and degradationrelated
Bans and perverse incentivesrelated
Gilded trapsrelated
Roving banditrynested

Related Studies


Cinner, J E, and T R McClanahan. 2006. “Socioeconomic Factors That Lead to Overfishing in Small-Scale Coral Reef Fisheries of Papua New Guinea.” Environmental Conservation 33 (1): 73–80.


Tucker, Catherine M. 1999. “Common Property Design Principles and Development in a Honduran Community.” Fletcher Journal of Development Studies XV.


Klooster, Daniel. 2000. “Institutional Choice, Community, and Struggle: A Case Study of Forest Co-Management in Mexico.” World Development 28 (1): 1–20.


Bardhan, Pranab. 2000. “Irrigation and Cooperation: An Empirical Analysis of 48 Irrigation Communities in South India.” Economic Development and Cultural Change 48 (4): 847–865.


Tucker, Catherine M, J C Randolph, and Edwin J Castellanos. 2007. “Institutions, Biophysical Factors and History: An Integrative Analysis of Private and Common Property Forests in Guatemala and Honduras.” Human Ecology 35 (3): 259–274.


Agrawal, Arun, and Gautam N Yadama. 1997. “How Do Local Institutions Mediate Market and Population Pressures on Resources? Forest Panchayats in Kumaon, India.” Development and Change 28 (3): 435–465.