Commons in tourism: how self-organization may overcome transaction costs

Safeguarding environmental resources, including (but not limited to) environmental amenities, biodiversity, landscape with cultural vale as that of Venice or Pompei, is a major challenge both in the developed and the developing world. Most environmental goods are not "public goods", in the sense that they may be either rival in, or excludable from, consumption or they may have an "existence value" higher to their marginal "use value" that may not be fully captured by market prices (Forte 2014, "Existence value versus use value in cultural goods and their sustainability"). Such goods - called commons (Ostrom 1990, "Governing the Commons") - can be characterized in most cases as renewable only up to a point. If that threshold is surpassed, the good becomes depleted. This can be a serious problem whenever the inter-generational distribution of (social) costs and benefits involves a "time consistency" problem. At an initial stage of development the values of  these goods  are virtually ignored. As per capita GDP grows, they become a political issue but, in most cases, the proposed solutions are bureaucratic and ineffective. The protection of the Italian landscape is a quintessential example .A potential solution should be pursued by allowing for institutional experimentation. National governments (or, in some cases, supra-national bodies) should identify the commons that may deserve special protection. The identification of institutional arrangements to protect these commons should be as decentralized as possible. National (or supra-national) regulators should limit themselves to the implementation of efficient monitoring and, to some extent, sanctioning mechanisms. The rationale of this approach lies in the "knowledge problem" (Hayek 1945, "The Problem of Social Cost")  inherent to this kind of issues: local communities may be better equipped both to assess the "real" existence value of environmental-cultural commons, and to develop effective institutional incentives for private actors to maximizes private welfare under the constraint of maximizing social welfare. Such institutional arrangements can include regulated private property, public ownership, ad-hoc regulations, private management of public resources, etc. The most effective policy, as well as the nature of the entities charged with taking care of these commons, will ultimately depend upon transaction costs (Coase 1960, "The Problem of Social Cost"). Therefore the most important goal of such policies should be to minimize transaction costs in order for the market to discover the relevant information regarding the commons' "existence value".