Understanding Policy: Collective Action

This week, JIPS Blog will publish memos that use the framework of Mancur Olson's seminal work, The Logic of Collective Action, to elucidate the ways in which groups act when obtaining a public good. In order to fully understand the following posts, readers may benefit from a summary of the logic. Emma Sopadjieva, IR/PS 2015, succinctly provides such a summary:

Mancur Olson’s collective action (CA) theory is centered on the relationship between group size and the cohesiveness and effectiveness of the group. Olson claims that when groups provide public goods (non-excludable and non-rival) there is a tendency of members to “free ride”. Rational self-interested actors will not voluntarily act towards the common purpose of the group, as members have the incentive to take advantage of the benefits created by others in the group without paying the costs. In order for CA to function, apart from a common goal, one of the following must hold: 1) CA is obligatory (i.e. taxes), 2) actors are offered “selective incentives”, 3) social pressure is applied or 4) CA is in each small group’s member’s interest, with a tendency of “exploitation of the great by the small”. Olson distinguishes between small and large groups and states that the larger the group the less effective it is in providing an optimal amount of the collective good due to three key factors: 1) each actor receives a smaller portion of the benefits, 2) there is a lower probability that each member’s benefits will outweigh the costs of action, and 3) organizational costs increase with larger groups. Olson defines four main kinds of groups: 1) privileged groups (each or at least some of the actors have enough of an incentive to provide the collective good unilaterally), 2) intermediate groups (a refusal of a member to contribute to the common goal, causes a noticeable decrease in supply of the good or a rise in costs to others), 3) latent groups (a refusal of a member to contribute, does not cause a noticeable decrease in supply of the good), and 4) unorganized groups (have no lobby and take no action).

Olson's logic is the cornerstone of this week's posts. We hope that the following entries illuminate the ways in which collective action logic can explain public policy.