A new electoral bottom-up model of institutional governance

The sustainable governance of Global Risky Commons (GRC)-global commons in the presence of a sizable risk of overall failure-is ubiquitous and requires a global solution. A prominent example is the mitigation of the adverse effects of global warming. In this context, the Collective Risk Dilemma (CRD) provides a convenient baseline model which captures many important features associated with GRC type problems by formulating them as problems of cooperation. Here we make use of the CRD to develop, for the first time, a bottom-up institutional governance framework of GRC. We find that the endogenous creation of local institutions that require a minimum consensus amongst group members-who, in turn, decide the nature of the institution (reward/punishment) via an electoral process-leads to higher overall cooperation than previously proposed designs, especially at low risk, proving that carrots and sticks implemented through local voting processes are more powerful than other designs. The stochastic evolutionary game theoretical model framework developed here further allows us to directly compare our results with those stemming from previous models of institutional governance. The model and the methods employed here are relevant and general enough to be applied to a variety of contemporary interdisciplinary problems.