Ostrom compared many real cases of shared resources and found that users often create and enforce their own rules. She also identified design features common to the successful ones.
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It is the conflict that arises when someone acts on another's behalf, has different interests, and knows more than the person they act for, so cannot be fully checked.
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Mechanism design starts from a desired outcome and designs the rules of a strategic setting so that participants' self-interested choices produce it. Kidney exchanges and auctions are two major applications.
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Olson argued that in stable societies, special-interest groups accumulate over time and divert effort from growth to redistribution, slowing economies until upheaval clears them away.
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Corporations and sovereign debt rely on legal fictions, such as treating an entity as a separate person, which let strangers cooperate when a state or other actors uphold them.
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