Tourist Fees and Tragedy of the Commons

Tia Belau Editorial, June 21, 2012 —

“Chibngii ra tut” has been the mantra for many in the national leadership that it is time for the 16-states in the Republic to start fending for themselves, and not rely on the national government coffers for handouts.

However, such talk has not been lost with some of the states, who are determined to use their natural resources to increase revenue for their treasuries.

Peleliu State is the latest to impose $30 diving fees within its state’s waters. For other water activities it is $10, and the same rate for land tour.

The rate increase by Peleliu followed Koror’s big jump for rock island and jellyfish lake fees.

Ngardmau already doubled its visitor fees to the waterfall to $10. Other states may not be far behind in imposing other fees just to increase the states’ income. How this trend will play out, have great potential to hurt the tourist industry and weaken the national government’s ability to raise revenue, which is highly dependent on tourism.

Annual tourist receipt contributes to around 50 percent of GDP.

This brings to mind one of the most famous dilemmas in “Game Theory.” The most cited article in Science Magazine ever is American ecologist Garrett Hardin’s “The Tragedy of the Commons.”

Hardin says “tragedy” occurs when community resources are claimed or used by many with little effective restriction.

He illustrated it with the story of a group of herders each grazing his own animals on common land, with one herder thinking about adding an extra animal to his herd. An extra animal will yield a tidy profit, and the overall grazing capacity of the land will only be slightly diminished, so it seems perfectly logical for the herder to add an extra animal.

The tragedy comes when all the other herders think the same way. They all add extra animals, the land becomes overgrazed, and soon there is no pasture left.

The same argument can be applied to the tourist fees. The national government is collecting the “green fees.” States’ are now practicing charging more to pay for their state operations.

They think that an increase here and there won’t make that much of a difference, but when every state start imposing their own fees, the cumulative impact deals a big blow to the tourist spending habits, ultimately costing everyone the much needed cash for economic development.

If the practice by state and national governments to raise tourist fees continues, at some point the tragedy will emerge.

Fortunately, the problems of tourist fees are not so dire to the point that a recovery is needed. However, leaders at the national and state level must sit down if an effective solution has to be found.

The lesson, as in many cases, is that remedies do not come early, but rather, late. They may come too late to avoid the losses of the Tragedy of the Commons.

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