Editor's Note: This brief series on Collective Action demonstrates how public policy can be analyzed through the lens of Mancur Olson's The Logic of Collective Action. Each piece looks at a specific humanitarian crisis and how the logic applies for that case. For a brief summary on the theory, see Understanding Policy: Collective Action.
By Nicholas Beaudoin
On January 12, 2010, a 7.0 magnitude earthquake struck the town of Léogâne, a mere 25 miles from the Haitian capital of Port-au-Prince. With over 220,000 people killed, 300,000 injured, vital infrastructure destroyed and 1.5 million people displaced, the earthquake quickly gained international attention. Within the first year, $4.5 billion was pledged by various governments, NGOs and private citizens (Provost). An impressive collaboration of 600 NGOs and myriad government agencies, coupled with the United Nations, arrived within 24 hours to provide relief. However, one year after the earthquake, only 5 percent of rubble had been cleared, 1.6 million people were still living in camps, and 15 percent of basic and temporary housing had been built. By 2012, only 43 percent of funds had been delivered.
Olson’s collective action model explains the humanitarian shortcomings in Haiti. Olson determined that an effective organization must have a small membership. “The larger the group, the less it will further its common interests” (Olson 1965). The sheer size of the Haitian relief group limited its effectiveness for three reasons. During the Haitian mission, defining success proved useless; various members had differing views on what relief and reconstruction meant. Without a unified goal, a cohesive strategy in Haiti was unachievable and NGO members continued to base their relief efforts on a vertical, top-down style, with little collaboration with other members. Second, due to the size of the humanitarian mission, any action taken by an individual member had little overall effect on the relief effort. Furthermore, if an NGO or government failed to deliver promised funds or supplies, there was no method of accountability to ensure such compliance of latent members. Finally, since individual members have a diluted marginal impact on operations, the incentive to contribute less than what was promised increases. The risk that members will become latent “free-riders” by reneging on previous commitments, while continuing to receive benefits as a member of the group, increases as the size of the group increases. The free rider problem was evident in Haiti, where countries such as Belgium and South Korea reneged on their financial commitments, while maintaining their good-neighbor image and receiving international goodwill.
Olson’s model of the perfectly competitive market highlights NGO competition with the allocation of goods and benefits for NGOs defined as exclusive goods. As each NGO attempts to gain access to media outlets, thereby increasing their exposure to the public, members will compete for coverage. Organizations that are more readily recognized as providing aid will therefore receive further financial support from contributors. In this way, the benefits of media exposure are defined as exclusive goods where the supply of media exposure is limited. Since NGOs are competing for media attention, an increase in benefits for one NGO decreases the pool of available media attention for the remaining NGOs. A zero-sum game of media benefits further inhibited NGO collaboration and ensured that NGO’s would try to maximize media coverage rather than welfare.
Finally, the principle of suboptimality played a decisive role in explaining disruptions in aid contributions from governments. Suboptimality embodies the idea that members ceased financial support once they felt their version of success had been completed. Since members of the relief effort had differing views of what constituted success in Haiti, benchmarks for achieving project completion varied. Those that had a lower threshold for what a successful mission represented cut off financial support early, therefore placing a greater proportion of the cost on other governments. It also encouraged all NGOs to adjust their support to meet the lowest common denominator so that they wouldn’t be left footing the bill.
To combat latent members, such as NGOs and governments that renege on their commitments, certain coercive instruments may be put into place to ensure compliance. Barriers to participation in world organizations, such as the World Trade Organization, and regional free trade agreements can be erected. Private organizations, such as the numerous NGOs involved in Haiti, can be refused tax-exempt status in the United States and be treated as a private, for-profit enterprise. To reward commitment, governments can offer subsidies to NGOs and most favored nation status for trading partners. These private incentives induce actors to participate whether or not anyone else reneges.
The failed international humanitarian intervention that followed the 2010 earthquake in Haiti can be explained through Olson’s theories on collective action. A large group of NGOs and governments, acting in their own understanding of success, combined with a lack of common purpose and accountability, led to the inefficiencies and coordination problems between members of the relief group. To prevent future inefficiencies, an international effort to coerce members through both positive and negative repercussions is necessary.
Nicholas Beaudoin is a first year graduate student at IR/PS studying international economics with a focus on China. He graduated from Lewis and Clark College in 2007 with a B.A. in Political Science and a working proficiency in French. He has worked in Taiwan for 3 years and continues to study the triangular relationship between China, Taiwan and the US.
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“A year of indecision leaves Haiti’s recovery at a standstill, last modified on 12 Jan. 2012,http://www.oxfam.org/en/pressroom/pressrelease/2011-01-06/year-indecision-leaves-haiti-recovery-standstill
“Haiti 2010 Earthquake,” last modified 22 March 2014, https://en.wikipedia.org/wiki/2010_Haiti_earthquake.
Olson, Mancur, Collective Action: Public Goods and the Theory of Groups (Cambridge: Harvard Univeristy Press, 1965).
Provost, Claire, “Haiti earthquake: Where has the aid money gone?” last modified 12 Jan. 2012, www.theguardian.com
Karunakara, Unni, “Haiti: Where Aid Failed,” last modified 28 Dec. 2012, www.theguardian.com
“Haiti Earthquake: 4 years later,” last modified 12 Jan. 2014, www.oxfam.org/en/haitiearthquake