The Importance Of Collective Action

849 Words4 Pages
As mentioned earlier, collective action is mostly associated with public goods . Most of the public goods by nature have externality associated with them. Externality is a phenomenon of unintended, uncompensated welfare effect of action of one economic agent on the other. An action with consequences for other person is said to exhibit externality (Tim, 1994). In other words, irrespective of the individual efforts put in achieving the benefit through common action, the benefit will be equally shared by all the members of the group. This can lead to phenomenon called “free riding” where the person enjoys the benefit without making any contribution. (Tim 1994, Oliver and Marwel 1988, Macy 1990). This situation may also leads to another associated…show more content…
Smaller the group, easier the communication, increased visibility and responsibility can actually leads to better cooperation among the members of the group. But this view has been contradicted by many other researchers lead by Oliver and Marvell 1988. According to their hypothesis, larger heterogeneous groups have lower critical mass . The skewed distribution of resources among its members actually reduces the number of volunteers needed to form the critical mass and thus making collective action less complex and less expensive. Even though in larger group free rider problem is difficult to control, to some extent can be minimized by proper incentive structure. The group structure should be so framed in order to accommodate selective incentive to members based on the extent of participation in collective action. Those who follow the assigned responsibility need to be rewarded and those who shirk away must be penalized. These incentives when repeated leads to social learning process and gradually free rider problem will get minimized (Macy,…show more content…
In case of farmer cooperative for marketing, the cooperation was found to depend on three important factors. A) Match between skills of farmers and skills required, B) Cohesion among the group members and C) Commercial outlook of the group (Stringfellow et al. 1997). These three factors are required in the form of minimum level of education, skills, experience etc. So it will be a difficult task to organize the poor in the frame work of collective action (Jon et al 2007). Though it is a problem, proper communication of technologies with the members and provision of better training facilities for the members on required skill and knowledge oriented technologies, serves as one of the best solution to the issue of

More about The Importance Of Collective Action

Open Document