Friday, February 12, 2010

Ostrom and Network Neutrality

My previous post scratched the surface of a self-regulatory solution to network neutrality concerns. While this isn’t exactly a common pool resource (CPR) problem, I find Elinor Ostrom’s eight principles for managing CPRs are helpful here (Governing the Commons: The evolution of institutions for collective action, 1990).

Jonathan Sallet boils them down to norms, monitoring and enforcement, and that’s a good aide memoire. It’s useful, though, to look at all of them (Ostrom 1990:90, Table 3.1):
1. Clearly defined boundaries: Individuals of households who have rights to withdraw resource units from the CPR must be clearly defined, as must the boundaries of the CPR itself.

2. Congruence between appropriation and provision rules and local conditions: Appropriation rules restricting time, place, technology, and/or quantity of resource units are related to local conditions and to provision rules requiring labor, material, and/or money.

3. Collective-choice arrangements: Most individuals affected by the operational rules can participate in modifying the operational rules.

4. Monitoring: Monitors, who actively audit CPR conditions and appropriator behavior, are accountable to the appropriators or are the appropriators.

5. Graduated sanctions: Appropriators who violate operational rules are likely to be assessed graduated sanctions (depending on the seriousness and context of the offense) by other appropriators, by officials accountable to these appropriators, or by both.

6. Conflict-resolution mechanisms: Appropriators and their officials have rapid access to low-cost local arenas to resolve conflicts among appropriators or between appropriators and officials.

7. Minimal recognition of rights to organize: The rights of appropriators to devise their own institutions are not challenged by external governmental authorities.

8. (For CPRs that are parts of larger systems) Nested enterprises: Appropriation, provision, monitoring, enforcement, conflict resolution, and governance activities are organized in multiple layers of nested enterprises.
Many but not all of these considerations are addressed in the filing and my comments: The headline of section B that “self-governance has been the hallmark of the growth and success of the Internet” reflects #2. My point about involving consumers speaks to #3. The TAGs mooted in the letter address #4 and #6, but not #5. The purpose of the letter is to achieve #7.

In addition to the lack of sanctions, two other key issues are not addressed. Principle #1 addresses a key requisite for a successful co-regulatory approach: that industry is able to establish clear objectives. Given the vagueness of the principles in the filing, it’s still an open question whether the parties can draw a bright line around the problem.

I believe #8 can help: create a nested set of (self- or co-) regulatory enterprises. While I don’t yet have concrete suggestions, I’m emboldened by the fact that nested hierarchy is also a hallmark of complex adaptive systems, which I contend are a usable model for the internet governance problem. Ostrom’s three levels of analysis and processes offer a framework for nesting (1990:53):
  • Constitutional choice: Formulation, Governance, Adjudication, Modification
  • Collective choice: Policy-making, Management, Adjudication
  • Operational choice: Appropriation, Provision, Monitoring, Enforcement
I think the TAGs are at the collective choice level. It would be productive to investigate the institutions one might construct at the other two levels. The FCC could usefully be involved at the constitutional level; even if one doesn't dive into a full-scale negotiated rule-making or "Reg-Neg", government involvement would improve legitimacy (cf. Principle #7). At the other end of the scale, operational choices include mechanisms not just for monitoring (and some tricky questions about disclosure of "commercially confidential" information) but also enforcement. The latter could be as simple as the threat of reporting bad behavior to the appropriate agency, as the Better Business Bureau’s National Advertising Division does (see Weiser 2008:21 PDF).

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