In 2009, the political economist Elinor Ostrom won a Nobel Prize for studying how nomads in Africa, farmers in Nepal and others learned to forgo individual incentives for a quick buck in favor of longer-term shared profits.
If a country were to reduce its greenhouse gas emissions, the benefits would be shared by the entire world, thus reducing individual incentives for engaging in mitigation.
This last utility function is not particularly meaningful in terms of policy applications, but nevertheless offers insights on the importance of individual incentives for solving the problem of segregation.
Of note, purchasers should be cautious in applying hybrid structures (e.g., using both group and individual incentives for a team with high interdependence among team members) because they have shown to perform worse than pure structures [ 97], perhaps because they are less transparent and therefore less visible to providers.
Other strategies to consider include increasing individual incentives for providers through revised payment structures emphasizing performance-based payment [ 59, 60], and incentivizing organizations by awarding grants to facilities to support innovative strategies to increase transparency, as has been done in Mongolia [ 61] and Vietnam [ 62].
This choice is not strictly about alternatives, as performance appraisal/individual bonuses aligned with the adjunct incentives can be used in concert with overall payment system design (for a recent review of individual incentives see [ 51], for economics perspectives see [ 52- 54]).
Lindahl's approach establishes a framework that allows people to pay individual prices and creates an incentive for individuals to pay their actual marginal benefit, since the price is reflective of the benefit they will receive if the good is provided.
For individuals, the incentives for protecting the environment are seemingly obvious.
Collectivising debt removes the incentive for individual countries to put their own public finances in order.
Therefore, there is little incentive for individual states or corporations to do anything other than free ride.
