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Why Elinor Ostrom is the future of public services
Adam Lent, Director, NLGN, 4 March, 2019

@adamjlent

In our report The Community Paradigm, published last week, Jessica Studdert and I explored a new model of public services emerging on the frontline of delivery. We argued that the key idea at the heart of this model is the transfer of power and resource from public sector institutions into the hands of communities and networks. The ultimate aim of this transfer is to create communities better able to take on the responsibility for looking after their own health, well-being and happiness.

While the Community Paradigm has emerged organically in response to the daily pressures of service delivery, it is vital to acknowledge that it also has a strong academic body of work behind its core idea. And the thinker with the greatest relevance is Elinor Ostrom.

Who was Elinor Ostrom?

Elinor Ostrom was ground-breaking in many ways. Most obviously, she was the first woman to win the Nobel Prize for Economics. In fact, she is the only woman to win the Nobel Prize for Economics. But she also challenged conventional ways of doing economics rejecting an obsession with abstract models and instead doing extensive fieldwork and even laboratory experiments. An approach that made her Nobel Prize particularly controversial amongst more conventional economists.

Her most famous work is on common pool resources. These are resources which are available for all to use. Examples might include an easily accessible fishing lake, forests used for timber and hunting or human-made resources like irrigation systems. The key thing about a common pool resource is that although it is easily accessible and can be used widely, it is not inexhaustible. As a result, a fishing lake can be overfished, a forest stripped of its timber and an irrigation system drained of its water.

Before Ostrom, the consensual view was that common pool resources were destined to depletion through over-use. To avoid this the state needed to step in to limit access through approaches such as licencing. Alternatively, the resource would need to be privatised so that it was legally owned by one or a number of people who would then have a financial or personal interest in limiting access and maintaining the resource in a sustainable fashion.

Ostrom’s fieldwork revealed that this assumption was wrong. She showed that common pool resources were very widely managed in entirely sustainable ways – sometimes for many centuries – by rules and practices mutually agreed by those using the resource. There was no need for the state to intervene and no need for private ownership for things to work fine.

Ostrom used many real-world examples to prove her case such as the Swiss farmers who ensured communal summer pasture was not exhausted by applying the informal rule that no farmer could send more cows to the pasture than they could adequately feed on their private plot during the winter. To this Ostrom added dozens of similar case studies covering a wide variety of different types of resource and exploring systems requiring varying levels of complexity.

Ostrom was no narrow economic specialist. Her work extended beyond the study of common pool resources to explore more generally how self-governing systems operate. For example, she did extensive work on policing concluding that small police forces rooted in their communities were both more efficient and effective than larger, centrally controlled forces.

Nor was she a dogmatist. She recognised that the relationship between self-governing systems, the state and the market was complex and nuanced with all three sometimes playing a valuable, mutually beneficial role under the right circumstances.

Ostrom and the Community Paradigm

Ostrom died in 2012 and her work spanned five decades but, within the public sector at least, her analysis seems fresher and more relevant than ever.

Most important is her vast body of empirical work proving that communities can run themselves perfectly well without help from the state or without having to resort to market transactions. This is analysis that provides a powerful intellectual underpinning to the work being done by a growing band of public sector innovators. They are implicitly rejecting the state-centric view of public service that dominated thinking for four decades after the war and which has undergone something of a resurrection in the Labour Party. But they aren’t taking any lessons from the marketisation trend so popular with policy-makers since the 1980s and which the Conservative Party still clings to if rather half-heartedly.

Like Ostrom, these innovators have seen that there is another way: they know that when communities can be mobilised to care for themselves driven by shared behavioural norms rather than top-down edict or market transaction, public money is used more efficiently and positive outcomes are enhanced.

Ostrom also gives backing to the seemingly contradictory idea that pubic servants working for the state can play a role in self-governance. She believed in self-governing communities but she was no anarchist or libertarian. Her extensive fieldwork revealed that the state does play an important role in helping communities to launch and maintain self-governing approaches. Her work on fisheries, for example, found that when community self-governance breaks down, the state can intervene effectively to protect resources and to establish new ways of managing things. The key, however, is not for the state to take over but to act as a catalyst for new self-governing systems to emerge. It is a principle that can be seen at work in innovations such as Big Local, community business, Participatory City as well as a plethora of others.

Finally, Ostrom’s work has something powerful to say about the wider national policy framework within which the Community Paradigm is emerging. She argued for a system built around multiple centres of control with overlapping decision-making made up of a complex web of state provision, market transaction and self-governance operating at national, regional and local level. She was a political control freak’s nightmare having produced extensive evidence that undermines the common-sense assumption that things are always best when standardised and centrally controlled. Ofsted she wasn’t!

Such ‘polycentricity’, as she called it, would inevitably allow greater innovation to flourish, enable learning and, most importantly, be more resilient than systems with only one or a handful of power centres where mistakes can cause widespread suffering and even systemic collapse.

Ostrom: Good news for public sector radicals

Public sector innovators handing power over to communities can take a great deal of comfort from Ostrom. Firstly, their approach is backed by a Nobel prize-winning economist who based her conclusions on decades of empirical, real world research. Secondly, Ostrom’s wider polycentric vision shows that their innovations are not one-offs or local curiosities with little transferability: they are the beginnings of a much more creative and resilient system for public service delivery with national and even global relevance.

Finally, and maybe most intriguingly, it suggests that there is a whole world of intellectual analysis out there that can be dived into to help develop Community Paradigm approaches. Ostrom’s output is prodigious but she also had many followers who have deepened her analysis further since she first started publishing fifty years age. A treasure trove awaits.