Sustainable Development

Sust. Dev. 15, 370–381 (2007)

Published online 26 March 2007 in Wiley InterScience
(www.interscience.wiley.com) DOI: 10.1002/sd.322

Collaboration as a Pathway for Sustainability

Rodrigo Lozano*
BRASS Centre, Cardiff University, Cardiff, UK

ABSTRACT
Conventional individualistic behaviours with their quest for profit maximization and
wealth accumulation have created economic, environmental and social imbalances
in today’s world. These imbalances threaten to become worse in the coming years,
decades and centuries. Calls and efforts towards sustainable development (SD) seek
to establish a dynamic equilibrium among these elements. One of the key elements
in the transition towards more sustainable societies is collaboration.
This research presents three game theory tools to help rationalize that collabora-
tive behaviours offer better results than individualistic ones. The first presented is the
prisoners’ dilemma. The second is the tragedy of the commons, a tool similar to
the prisoners’ dilemma but with more actors increasing the complexity. The third, the
Nash equilibrium, offers a mathematical way to attempt to reach a system’s optimum,
i.e. to obtain the result that would in a totality benefit all the players. The tools
are linked to SD problems. Copyright © 2007 John Wiley & Sons, Ltd and ERP
Environment.

Received 12 October 2006; revised 31 January 2007; accepted 31 January 2007

Keywords: sustainable development; collaboration; game theory; prisoners’ dilemma; tragedy of the commons; Nash
equilibrium; Homo Oeconomicus; Homo Socii-collaboratibus

Introduction

HE DOMINANT SOCIO-ECONOMIC PARADIGM (DSP), BASED ON NEO-LIBERALISM, HAS LED TO

T individualistic behaviours becoming increasingly pervasive in today’s societies, particularly those

of high-income countries. Individualistic behaviours are inherent to the Homo oeconomicus, the
cognomen given to human beings that are greedy and self-interested, base their decisions purely
on rationality, have an insatiable wish to accumulate material resources and attempt to maximize their
utility while minimizing their costs (Alvey, 2000; Faber et al., 2002; Fadeeva, 2004; Rees, 2002;
Weymes, 2004). Such individualistic behaviours have created increasing imbalances between economic,
environmental and social dimensions, straining the world’s carrying capacities. This article addresses
the following question: how might we achieve the two necessary dynamic equilibria, the one between
today and tomorrow and the other between the economic, environmental and social dimensions, where
each has the same weight and importance, in a world where all the indicators point to the short term
economic considerations being given pre-eminence over the others?

* Correspondence to: Mr. Rodrigo Lozano, BRASS Centre, Cardiff University, 55 Park Place, Cardiff CF10 3AT, UK. E-mail: lozanorosr@cf.ac.uk

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment
Collaboration as a Pathway for Sustainability 371

To answer this question this article builds upon three game theory tools to develop the proposition
that progress depends upon reversing the trend towards increasing individualism and moving towards
greater collaboration:
(1) the prisoners’ dilemma;
(2) the tragedy of the commons and
(3) the Nash equilibrium.
Individualistic behaviours would not pose a problem if (1) the population of Homo Oeconomicus were
small and stable, (2) world resources were infinite or (3) all the resources of the world were allocated by
perfect markets. Unfortunately, these conditions are obviously not present. The population of the world
is now over six billion people, and growing, with an increasing number being drawn into consumer
society and towards behaviours as Homo Oeconomicus. The Earth is virtually a closed system in regard to
matter, since practically nothing enters or leaves it. The markets that meet the needs of those living
beyond a subsistence existence across this planet are widely acknowledged to be imperfect due to a lack
of information, transaction costs and free and fair choice (Holden et al., 1998, p. 107) and the social and
environmental costs of much of our production and consumption activities remain unmet (WCED, 1987).
Population growth and individualistic behaviours in a resource-limited planet have led to the over-
exploitation of natural resources, e.g. forests, groundwater and fisheries (Rees, 2002). They have also
favoured the increase in economic disparity between rich and poor nations, i.e. 30:1 in 1960 (Reid, 1995)
to 77:1 in 1980 to 122:1 in 1999 (Weller and Hersh, 2002), but also within the nations, where the rich
keep on getting richer and the poor poorer. As a result the world’s life support systems are being stressed
to their limits, threatening the world’s fragile two tiered equilibria: the first tier being the equilibrium
among economic, environmental and social aspects; the second dealing with the interaction of the first
tier equilibrium in the longitudinal perspective, i.e. the multiple interaction of the three aspects in the
short, long and longer term (Lozano, 2006). Calls and efforts for sustainability and its principles seek
to dynamically re-establish these complex equilibria. In such re-establishment, individual, local and
global needs must be addressed and fulfilled for the short term as well as for the long and longer term.
It is hoped that the ideas presented in this paper will help drive Homo Oeconomicus into fast extinc-
tion and allow a new breed of humans, Homo Socii-collaboratibus, populate the Earth and accelerate the
transition towards more sustainable societies; or that the latter would out-evolve the former. Homo Socii-
collaboratibus, in contrast to Homo Oeconomicus, would not attempt to maximize their utility at the
expense of others based solely on rationality. Instead, they would look to obtain, through collaboration,
the optimum in their society, or system, where each of the parties would make a decision that would
offer them the best possible gains, but being constrained by the strategies of the other parties that would
also make them have the best possible gains; i.e., the decisions of each of the parties are a function of
the others.

Collaboration as a Key Element for Sustainability

Sustainability has been defined by many authors, of which the definition by the Brundtland report, Our
Common Future (WCED, 1987), is the most widely known and cited. Common to most definitions are
the two tiered equilibria above mentioned. It is not the purpose of this article to review the myriad def-
initions of what sustainability is, but to focus on a key element in terms of how it might be achieved:
collaboration.
Some authors use the term collaboration without specifying its meaning, e.g. Fadeeva (2004), while
in other cases it is used interchangeably with communication, coordination and co-operation (Denise,

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
372 R. Lozano

1999). Nevertheless, each term has different meanings and participant involvement levels (Denise,
1999; Tunstall, personal email communication, 2005). Denise (1999) considers the four terms to be
part of a pyramid, while for Tunstall (personal email communication, 2005) communication is implicit
in the others and should not be included as a specific element. If communication is included in the
pyramid it is located at the bottom layer, otherwise it is coordination, followed by co-operation and col-
laboration at the top. Of the three, collaboration has the highest level of involvement. The following list
presents an explanation of the terms.
• Communication is how persons understand each other and how information is transferred in organi-
zations (Denise, 1999).
• Coordination looks to inform the parts of a system as how and when they must act. It provides a frame-
work that looks for efficiency forces that otherwise would be divergent (Chilosi, 2003; Denise, 1999).
• Co-operation is about taking and sharing the values of the group. It often becomes a socialization exer-
cise and not an increase of performance (Denise, 1999). Co-operation breaks when one, or more,
players involved perceive that there is nothing to be gained for them (Odero, 2002).
• Collaboration is about using information, divergent insights and spontaneity to solve problems and
develop new understandings or new products. It thrives on differences coming from sparks of dissent
(Denise, 1999).
Tunstall (personal email communication, 2005) complements Denise’s (1999) explanations with an
inter-organizational perspective: if organizations wish to work together they have to start to communi-
cate on the lowest level to be able to coordinate activities, followed by co-operation, i.e. engaging in work
on monitoring and evaluation, learning from each other and sharing experiences. Finally, collaboration
appears when the organizations jointly develop proposals, share information, plan joint workshops and
raise funds together, among other activities (Tunstall, personal email communication, 2005). Collabo-
ration can be ‘. . . increased and improved when people work in local, cross-functional or inter-organi-
sational teams’ (Flynn et al., 2003).
Collaboration harvests its benefits from differences in perspectives, knowledge and approaches,
solving problems while at the same time offering benefits to all those involved in the process. Some of
the benefits of collaboration include the ability to optimize financial and human capitals, access markets
and knowledge, enrich creativity, avoid confrontation, decrease time needed to accomplish objectives
and make processes more efficient (Fadeeva, 2004). Other benefits include being action orientated,
offering benefits to all the players, reducing or removing conflicts and in some cases trans-disciplinary
learning.
An example of collaboration applied at a societal level is the Curripaco, a fishing and hunting
tribe in Amazonia: ‘[Curripaco] men, who may have been hunting or fishing either individually or
collectively, bring their prey severally to their wives, who cook it individually. A bit of cooked food
may or may not then be consumed privately, but the bulk of the food is brought to the common
space in front of the longhouse . . . and aggregated to the common fund’ (Beckerman and Valentine,
1996, p. 660). The Curripaco not only share their workload and their food but they also have a long
term vision for their eco-system. They moderate their fishing by refraining from fishing for some days
after a plentiful catch (Beckerman and Valentine, 1996, p. 660). This exemplifies how in many tribal
cultures collaboration prevails upon individualism, in great part due to long term survival and experi-
ence.
On the other hand, lack of collaboration combined with competition, direct and indirect, can lead to
catastrophic environmental and social outcomes. Diamond (2005) offers the example of Easter Island,
where increases in population led to deforestation, which in turn led to tribal warfare, starvation, pop-
ulation crash and even cannibalism. Almost the entire Easter Island civilization was wiped out.

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
Collaboration as a Pathway for Sustainability 373

In more complex societies, stakeholders’ interactions can generate friction and conflicts, arising from
their often contradictory needs. Some forecasts see future conflicts shifting from territory and power to
basic environmental necessities, e.g. access to water. A change from individualistic mindsets and behav-
iours is needed to reduce and, hopefully, avoid such conflicts. By working collaboratively, individuals
can help reach the dynamic sustainability equilibrium. Multi-stakeholder collaboration has been
addressed by authors such as Orssatto (2001) and Fadeeva (2004).
The foregoing paragraphs present some of the benefits of collaboration. However, collaboration has
inherent difficulties. Genefke (2000) mentions two types of difficulty, naming them as costs, the first
being the coordination costs, which refer to operational dependence between the activities of the differ-
ent actors. The second, the vulnerability costs, refer to the risk of safeguarding the important and unique
resources. The two costs are complemented with three practical difficulties:

(1) information, referring to whom gets the benefits and the real, or hidden, agenda;
(2) bargaining, how to split the gains, and
(3) free riding, those who choose not to participate but still receive the benefits (Chilosi, 2003).

Another difficulty is when actors with individualistic mindsets interact with each other, leading to con-
flicts arising from incompatible or conflicting needs. This prevents the actors from seeing beyond their
personal short term needs and thinking of the common goal. Also, as Genefke (2000) remarks, collab-
oration can be held back by coordination problems in complex and interdependent organizations. It
should be noted that conflicts are, in many cases, latent. They need to be recognized and addressed to
ensure that collaboration will yield optimal results. Two types of conflict can be found: unnecessary and
genuine (Carley and Christie, 2000). Within unnecessary, readily managed, conflicts there are three
types:

(1) relationship conflicts, due to strong emotions, misconceptions or stereotypes, poor communication or
miscommunication, and negative, repetitive behaviour;
(2) data conflicts, due to lack of information, misinformation, different views on relevance and different
data interpretations, and
(3) value conflicts, due to day-to-day value, terminal values and self-definition values (Carley and Christie,
2000, pp. 166–167).

Within genuine conflicts, inevitable and difficult to avoid, there are two types:

(1) structural conflicts, due to how a situation is set up, role definitions, time constraints, geographi-
cal/physical relationships, unequal power/authority and unequal control of resources, and
(2) interest conflicts, due to substantive, procedural and psychological issues (Carley and Christie, 2000,
pp. 166–167).

In today’s inherently different and pluralistic world, potential conflicts are present amongst individuals,
groups, organizations, nations and other systems. Collaboration can help reach stability amongst the
different stakeholders, and reach the two tiered sustainability equilibria. The question is how to encour-
age individuals and organizations to behave in a more collaborative way in the face of the DSP that has
shifted mental models, defined by Senge (1999) as ‘. . . deeply ingrained assumptions, generalizations,
or even pictures or images that influence how we understand the world and how we take action . . .’ and
behaviours towards more individualistic ones. The following section offers game theory tools to help to
change from individualistic behaviours to more collaborative ones and help reach the two tiered sus-
tainability equilibria through game theory tools.

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
374 R. Lozano

Sustainability Dilemmas and the Commons

Game theory considers two types of game: zero sum and non-zero sum games. A zero sum game is one
in which in an interaction between actors one chooses their strategies in order to obtain maximum gain;
however, what one actor gains the other or others lose. In short, the sum of what is gained and lost is
zero, e.g. chess and poker. On the other hand, non-zero sum games are those in which gains minus
losses can be larger than zero. The importance is not to win or lose but to reach the system optimum,
or one of the optima in the case of multiple ones, where the global gain is maximum and all of the
actors win.
Envisaging sustainability as a zero-sum game is rather like imagining the budgeting process for a
country’s government as choosing a single ministry to give the entire budget to. Giving the entire budget
to the ministry for trade and industry would undoubtedly boost the economic output for the country in
the short term, but with severe social and environmental consequences as the health and welfare of the
population and environment suffered. In the longer term the economy would suffer as social and envi-
ronmental problems hampered industry. Investing the entire budget into the ministry for the environ-
ment would do wonders for environmental quality and protection, but lead to social unrest as needs
remained unmet and to economic decline that would shrink the future budget. Giving the entire budget
to the ministry for health and welfare would keep the people happier in the short term, but lead to
similar long term problems. These extreme examples, set out for the purpose of exposition, show that
taking zero sum game approaches to sustainability is not viable, especially with the many complex inter-
actions and inter-relatedness of aspects, and those of the many stakeholders. The search for a sustain-
ability equilibrium becomes a dynamic and interactive process where the economic aspects must be
wisely designed and developed to include and protect societies, engage and fulfil stakeholders’ needs,
stimulate individual and country/state productivity and make the economic and productive processes
mimic natural ones, where most of the raw materials are utilized and the wastes are recycled and reused
as inputs. Therefore, the societies would live on the wealth provided by nature and not on its ‘natural’
capital (Costanza, 1991; Daly, 2002).
Non-zero sum games offer a better option for complex and synergistic systems, such as the two tiered
sustainability equilibria. A point to consider is that ‘The search for common interest would be less diffi-
cult if all development and environment problems had solutions that would have everyone better off’
(WCED, 1987, p. 48). Following this approach, this author recognizes a renewed emphasis that collabora-
tion is a key element to in the search for progress towards the sustainability optimum, or one of the optima.
One tool that demonstrates the advantages of collaborative approaches over individualistic ones is the
simple case of the prisoners’ dilemma (PD) (Tucker, 1950).
The PD consists of two players with two possible decisions. The PD is based upon the situation that
two suspects, A and B, are arrested by the police. The police have insufficient evidence for a conviction
on a major charge, and having separated them, visit each and offer them the same deal: (1) if both pris-
oners, A and B, confess they receive 5 years each; (2) if either, A or B, confesses and the other one denies,
then the one who denied receives 10 years and the other goes free, and (3) if both deny, each gets 6
months jail term on a minor charge. There is no communication between the prisoners, thus no pos-
sible information exchange, nor direct collaboration. The choices and outcomes for each prisoner are
presented in Table 1.
Denial is the best solution for both, but the risk of not knowing the other’s decision leads to sub-
optimal solutions, where in this case the combined total time spent in jail in any of the sub-optimal
solutions is 10 years, while in the optimal situation it is only 1. In the example, the players base their
decisions not upon greed, as previously mentioned from the DSP, but upon fear.

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
Collaboration as a Pathway for Sustainability 375

A confesses A denies

B confesses Both serve 5 years A serves 10 years; B goes free

B denies B serves 10 years; A goes free Both serve 6 months

Table 1. Decisions and outcomes of each prisoner in the prisoners’ dilemma

Within the sustainability context, global warming could be considered as an example of the prison-
ers’ dilemma. Aiba and Saijo (2002) remark ‘Although the payoff for global co-operation is clearly the
highest as a whole, a developing country may obtain higher benefits through taking opposite measures
or through not taking any actions at all when the majority of other countries take actions for prevent-
ing global warming’ (Aiba and Saijo, 2002), i.e. the ‘free-rider’ problem. In this case, by relegating the
environment to a second or third level a country might, in the short term, achieve a perceived incre-
ment in economic growth, yet this un-collaborative strategy gives a sub-optimal solution due to the con-
tribution to global warming in the longer term.
There are very few such situations with only two players and two decisions. As the number of players
and factors in a system increases, it becomes harder to find the best solution (the ‘global optimum’ in
game theory), or equilibrium. As further players and factors are added to a system their interactions
become more complex, interdependent and synergetic; the PD evolves into the ‘tragedy of the commons’,
as developed by Garret Hardin (1968).
Hardin (1968) envisaged a pasture open to all, where each herdsman tries to keep as many cattle as
possible in the common land, the ‘commons’. Each herdsman wants to maximize his gain by adding
first one animal to his herd, and then another and another; on the individual side the herdsman increases
his gain from adding animals to his herds but on the ‘commons’ the gain is reduced through over-
grazing. In the long term this leads to reduction, or even disappearance, of the pasture and the herds-
men not being able to feed their animals. Hardin (1968) most wisely remarks that ‘Ruin is the
destination toward which all men rush, each pursuing his own interest in a society that believes in the
freedom of the commons. Freedom in a commons brings ruin to all’ (Hardin, 1968).
The tragedy of the commons can explain many current environmental and social problems encom-
passed in the sustainability challenge. Continuing with the example presented above, global warming,
one of the best alternatives to help reduce it is offered by the Kyoto Protocol with its binding greenhouse
gas (GHG) objectives. In this case the signatory countries to the protocol are the players. For the sake
of simplicity, the decisions for development should be considered to be (1) purely economic growth, an
individualistic greedy approach, and (2) economic growth following environmentally orientated princi-
ples. In this example the Earth’s atmosphere, affected by global warming, is the commons and the herds-
men are the world’s countries. Each country’s pursuit of economic growth, usually linked to oil
consumption, creates a positive loop, where more oil is needed for production and use purposes as time
passes and more GHGs are released, requiring more use of oil to reduce the effects. This non-collabo-
rative attitude to growth has direct negative effects on the global ‘commons’, the Earth. The aim would
then be to engage all the countries to engage in collaborative efforts in order to obtain an optimal eco-
nomic solution for reducing GHGs and thus for reducing global warming and its negative effects on
nature and societies.
The over-exploitation of fisheries provides another example (WCED, 1987, p. 263). During the last 50
years oceanic fish catch has expanded almost fivefold (Brown et al., 2002, p. 34). Fish through their
migratory patterns enter and leave coastal country borders and the high seas, the latter a case
of ‘commons’. Just as fish, naval fleets from industrialized countries, taking advantage of their
technological advancements, enter and leave the high seas, and intrude into the coastal territories of

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
376 R. Lozano

developing countries, which usually lack the appropriate economic or military means to prevent it; this
has led to over-exploitation of fish resources and to polluting littorals (WCED, 1987, p. 266). Thus, not
only is there an ‘over-grazing’ of the ‘commons’ by over-fishing but also disrespect for national fron-
tiers, increasing conflicts and lack of collaboration. The Marine Stewardship Council (MSC) is an
example of collaboration between a company, Unilever, and an NGO, World Wide Fund For Nature
(WWF), to reverse the continuous decline in world’s fisheries by developing an environmental standard
for sustainable and well managed fisheries that uses product labels that reward responsible fishery man-
agement and practices (Marine Stewardship Council, 2002).
The previous examples, even though they show sustainability’s non-zero sum nature, have focused
only on two aspects of sustainability, economic and environmental. To properly address sustainability
the social and longitudinal aspects need to also be addressed, i.e. the dynamic two tiered equilibria. The
goal is then to develop each of the three aspects so that the sustainability optima can be reached in this
and the future generations. This goal is easier to articulate than to achieve.

Nash Equilibrium and the Sustainability Dilemmas and Tragedies

Each additional element, whether it is a new group of stakeholders or any of sustainability’s aspects,
makes the solution for the sustainability optimum more complex and difficult to achieve. Each of these
elements plays an important role in the system, and their consideration and decisions, taken by them
or made for them, interrelate with those of other elements to affect the total outcome. A tool that can
be used to disentangle this chaos of factors, players and their interactions, and synergies is the Nash
equilibrium.
Nash (1950) developed his equilibrium to help solve non-zero sum games with n players, where n is
higher than two. Each of the players can choose a particular strategy according to their expectations,
resulting in n-pure strategies. Nash’s (1950) original statement is ‘Any n-tuple of strategies, one for each
player, may be regarded as a point in the product space obtained by multiplying the n strategy spaces of
the players. One such n-tuple counters another if the strategy of each player in the countering n-tuple
yields the highest obtainable expectation for its player against the n − 1 strategies of the other players in
the countered n-tuple. A self countering n-tuple is called an equilibrium point’ (Nash, 1950). Shor (2003)
clarifies this by remarking that ‘Players are in equilibrium if a change in strategies by any one of them
would lead that player to earn less than if he remained with her current strategy’ (Shor, 2003). The
system’s optimum is obtained when all the players have chosen their strategies that give them the optimal
payoff subject to the constraint of other players’ strategies’ also being allowed to achieve their optimal
payoff. Thus, the optimum is reached when there is no benefit to a specific player or the other players if
she/he changes her/his strategy. Although it may appear to be an esoteric piece of mathematics, the Nash
equilibrium was drawn to the attention of a wide audience as a key component of the plot in the film A
Beautiful Mind (Howard, 2001), when Nash (played by Russell Crowe) realizes that by taking a compet-
itive approach there is much to lose for all the players and little to win for only one player.
The following hypothetical example applies the Nash equilibrium to the tragedy of the commons. A
common pasture area can be used by two farmers, A and B. The following conditions are given for the
system:
• the pasture area has a maximum capacity of 182.5 tonnes/year of grass, the amount available on time
zero (the beginning of the first year);
• the pasture area regenerates at a rate of 40 per cent per year;
• on average the type of cows owned by the farmers consume 50 kg of grass per day, or 18.25 tonnes/year
(Equation (1));

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
Collaboration as a Pathway for Sustainability 377

• at the end of each year the farmers sell their cows at 1000 dollars (Equation (2)), trying to maximize
their profits; the farmers do not incur on any costs, e.g. labour or grazing rights;
• the maximum number of cows that each farmer could own at any time is five.

Fi = ((Fi −1 )(1 + Rg)) − ((Rc )(Co)) (1)

where
Fi is the food at the end of any given year in the pasture area, ranging from 0 to 182.5 tonnes;
i is any given year;
Fi−1 is the food at the end of the previous given year (or the beginning of the given year), ranging from
0 to 182.5 tonnes;
Rg is the rate of regeneration of the pasture, arbitrarily set at 40 per cent;
Rc is the rate of consumption of grass by the cows, with a value of 50 kg/(day cow), or 18.25 tonnes/(year
cow);
Co is the total number of cows on the pasture area, through any combination of cows from farmer A
and cows from farmer B.

Pr j ,i = (Co j ,i ) 1000

where
Prj,i are profits for farmer j at the end of year i;
Coj,I is the number of cows of farmer j at the end of year i;
J is the farmer, where j can be either A or B.
Table 2 presents the different combinations that can occur, e.g. farmer A keeping two cows and farmer
B three cows. Note that with nine or 10 cows, with any given combination, at the beginning of the second
year the formula indicates a negative number. It is not possible to have negative pasture, as it would be
considered as using unavailable resources. Negative results in food give profits of zero value. It should
also be observed that combinations with more than four cows in total produce declining results over
several years.
Using the principles of the Nash equilibrium all players need to choose their strategies so that they
yield a maximum profit but are constrained by the strategies of the other players. Consider in the first
instance only the two farmers, i.e. a 2-tuple solution, equivalent to taking a purely economic approach,
where the farmers would attempt to have five cows each on the common area to maximize their profits.
Such an approach would result in a rapid reduction of the available resources. This is common in strate-
gies that disregard the effects of economic activities on the environment.
If the environment is added as a player, creating a 3-tuple solution, then all players need to choose
strategies that maximize their earnings constrained by those of other players. For the example, the first
player to be dealt with will be the environment; note that any other player could have been chosen for
such a simple example. The maximum earned by the environment is 182.5 tons; with this the following
combinations could be taken (the first number is farmer A’s cows, while the second is farmer B’s):
(1, 1), (1, 2), (1, 3), (2, 1), (2, 2) and (3, 1); for more details refer to Table 2. After the different possible
strategies that could be taken by the environment, the second player to be dealt with is farmer A, who
can choose to have one, two or three cows. In his view the best would be to have three cows, but this is
constrained by the solutions of farmer B, who would choose the strategy that would give him the best
profit with all the previous constraints. The maximum number of cows that each of the farmers can
have is constrained by the environment and by the other farmer’s choice. The optimum in this example

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
378 R. Lozano

Combinations Year 1 Year 2

Number of cows Profits Profits

Farmer Farmer Total Food Farmer Farmer Food Farmer Farmer

A B (tonnes) A B (tonnes) A B

1 1 2 182.5 1000 1000 182.5 1000 1000

1 2 3 182.5 1000 2000 182.5 1000 2000
1 3 4 182.5 1000 3000 182.5 1000 3000
1 4 5 164.3 1000 4000 138.8 1000 4000
1 5 6 146.0 1000 5000 95.0 1000 5000
2 1 3 182.5 2000 1000 182.5 2000 1000
2 2 4 182.5 2000 2000 182.5 2000 2000
2 3 5 164.3 2000 3000 138.8 2000 3000
2 4 6 146.0 2000 4000 95.0 2000 4000
2 5 7 127.8 2000 5000 51.2 2000 5000
3 1 4 182.5 3000 1000 182.5 3000 1000
3 2 5 164.3 3000 2000 138.8 3000 2000
3 3 6 146.0 3000 3000 95.0 3000 3000
3 4 7 127.8 3000 4000 51.2 3000 4000
3 5 8 109.5 3000 5000 7.4 3000 5000
4 1 5 164.3 4000 1000 138.8 4000 1000
4 2 6 146.0 4000 2000 95.0 4000 2000
4 3 7 127.8 4000 3000 51.2 4000 3000
4 4 8 109.5 4000 4000 7.4 4000 4000
4 5 9 91.3 4000 5000 −36.4 0 0
5 1 6 146.0 5000 1000 95.0 5000 1000
5 2 7 127.8 5000 2000 51.2 5000 2000
5 3 8 109.5 5000 3000 7.4 5000 3000
5 4 9 91.3 5000 4000 −36.4 0 0
5 5 10 73.0 5000 5000 −80.2 0 0

Table 2. Results from applying Formula (1) with different combinations of cows at year 1 and year 2

is when each of the farmers has two cows in the grazing area. The presented example needs to be solved,
theoretically, simultaneously and not serially, as shown. In practice this proves to be most complex, since
it is necessary to know all the different variables and their impacts upon the other players, as well as the
external factors that might influence the grass production, positively or negatively, such as rain, drought
and animal or human diseases, amongst many others. Traditional methods have relied on trial and error,
yet this method would be likely to damage the productive capacity of the land before equilibrium could
be reached. Another variable that could be added that would make the optima more interesting to achieve
would be time, i.e. the strategy that yields maximum results over several years.
In regards to the global warming example, Chander et al. (1999) applied the Nash equilibrium logic
and concluded that ‘. . . a rational domestic optimum for each country would be one that best balances
these two aspects [consumption and emissions]; it is achieved by maximizing its own consumption level
xi with respect to ei [emissions] . . .’ (Chander et al., 1999, p. 254).
As previously stated, each country needs to choose its strategy to balance its consumption and emis-
sion levels, being constrained by the strategies of other countries, in such a way that an optimum solu-
tion can be reached where consumption and pollution in each country are balanced. This is supported
by Aiba and Saijo (2002), who remark that ‘. . . an emissions path for one’s own country would not be
decided by the country concerned but by other countries’ (Aiba and Saijo, 2002). It is clear that the more

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
Collaboration as a Pathway for Sustainability 379

countries are added, the more tuples there are, and the more mathematical variables that must be con-
sidered in achieving the optimum.
Another aspect that needs consideration in choosing strategies to reduce global warming is produc-
tion. New technological developments can help reduce the emissions from the source. The research and
development of fuel cells is a good example of this. A note of caution is in order: it is possible for eco-
efficient technologies to result in problems worse than those existing before the technologies. This is
caused when the eco-efficient technology or product is adopted and used by a population larger than
that of the previous ones, the rebound effect. The term eco-effectiveness, i.e. making the aggregate
impacts of the units of a products, processes or technologies more environmentally orientated, addresses
the setbacks of eco-efficiency (Dyllick and Hockerts, 2002).
It is implied, in the foregoing discussion, that decision-makers should make decisions for the long
term interest of the countries involved. In reality, democratically elected governments tend to be inter-
ested in short term solutions that would benefit them in the following election.
So far, the SD examples have focused on the equilibrium between economic and environmental
aspects. However, in order to reach sustainable societies the social aspects also need to be considered
in the quest for the optimum. Clearly, the more players that are added, the more elusive the optimum
becomes. The Nash equilibrium can help us to understand how to reach the optimum; to solve, at least
some, sustainability dilemmas and to avoid some of the tragedies of the commons.
The Nash equilibrium provides a method to reach a dynamic system’s optimal solution with multi-
ple players; yet, it is based on the capacity to represent phenomena with mathematical formulae. This
is, generally, not a problem for economic aspects. Environmental aspects are more elusive, especially
with their myriad unknown interactions. Social aspects are especially difficult to formulate, where each
individual, group, organization or society is different and reacts differently from the other ones. Emo-
tions, values, beliefs and cultures are not easily explained through mathematical functions. Even more
difficult to develop into formulas are the myriad short, long and longer term interactions of these three
aspects. Another drawback of the Nash equilibrium is that it is based on linear equations, whereas the
interactions among stakeholders, economic, environmental and social aspects, in the short and long
term, are non-linear. Even though the Nash equilibrium may lack the strength to solve and help guide
decision-makers to reach the two tiered sustainability equilibria it has the potential to serve as a good
starting point.
A question that arises is who has the authority to tell or make all the players follow the optimum
obtained with the help of the Nash equilibrium. In other words, who has the policing job to make sure
everyone follows the rules? And who sets up these rules? These questions are clearly valid in a system
where non-collaborative individualistic behaviours are predominant. Such individualistic behaviours
foster greed and competition, becoming pervasive against other individuals, groups, organizations, the
environmental and social aspects, and also, in the long term, the economic aspects themselves. In a
system where collaboration would be an inherent trait, such questions would have lesser, or perhaps
no, importance.
Another question that arises is whether a country’s leader or leaders will be accused by its citizens of
yielding to pressures from other countries to limit growth to reach the long term optimum instead of
the short term maximum, at the expense of others. This question could be valid if different countries
or parts of each country would take different approaches, i.e. one country or a part of it would rely upon
collaboration, while another on individualism. In such a case, the leader could indeed be accused of
betraying his/her country’s citizens. On the other hand, if all countries and their citizens would accept
collaborative approaches there would be benefits for all, leading to a more equitable and sustainable
world. Collaborative approaches require that countries and citizens choose their strategic decisions con-
sidering those of others, in such a way that the system’s solution reaches the optimum. This requires

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
380 R. Lozano

changes in individualistic mental models and behaviours, where greed and material and wealth accu-
mulation are not part of human thoughts and behaviours.
Changing mental models from individualistic to collaborative is not an easy task. The PD, tragedy of
the commons and the Nash equilibrium can help to explain and show that collaborative approaches and
behaviours, usually, result in higher gains for the different players, through participative action, and
conflict reduction, management or elimination. In contrast to individualistic behaviour sub-optimality,
collaboration can help reach the system’s optimum, or one of the optima. To be able to pick the fruits
of collaboration, it is essential that all players understand that we humans will not be able to survive in
the long term if selfish and greedy behaviours become more pervasive throughout the world’s societies.
Some of the barriers that impede collaboration have been engrained in societies, including education’s
mono-disciplinarity, as opposed to trans-disciplinarity (Roorda, 2001); the habitual quest for short term
economic benefits; the ever increasing population; the conflicting stakeholders’ needs and Homo Oeco-
nomicus’s greedy behaviours.
The examples of this article have shown how individualistic behaviours can negatively affect macro-
sustainability, i.e. global dilemmas in relation to the global commons. This does not imply that collab-
oration’s use is limited to macro-sustainability, but its use in the examples is for the sake of simplicity
and conciseness.

Conclusions

The article has shown the dangers of addressing sustainability through non-collaborative approaches,
as a zero sum game. In order to counter this, three game theory tools, the PD, the tragedy of the
commons and the Nash equilibrium, are presented to help Homo Socii-collaboratibus settle in. These
tools can help clarify that collaboration is a needed key element for sustainability, requiring that all the
players, even the silent ones such as the environment and future generations of plants, animals and
humans, communicate, become highly involved and learn from each others’ experiences. Each of
the players needs to keep an open mind to recognize that the other players, present and future, are
different and behave differently, where their needs must be recognized, addressed and fulfilled.
These differences have, as many examples throughout history testify, served as fuel for hatred and
discontent. Collaboration, in contrast, uses and benefits from such differences, which can result in
helping to achieve one of the optima, where all of the players will obtain benefits. The players need to
abandon the Homo Oeconomicus way, and change into mental models more in accordance with Homo
Socii-collaboratibus.
A most interesting conclusion comes from the Nash equilibrium: optimum solutions need to benefit
each and every one of the players, where each player’s strategies are constrained by those of other players.
In other words, a decision or activity is not an independent matter, but is tightly linked to many other
decisions, activities, strategies and implications, and these effects need to be considered in order to avoid
Earth and societies going below subsistence levels, collapsing and taking to extinction not only Homo
Oeconomicus but all other living species. As Odero (2002) remarks, ‘. . . collective action is absolutely
necessary in dealing with global commons’.

Acknowledgements
I would like to dedicate this article to the memory of my grandfather, J. G. Lozano-Ponce.
I would like to express my gratitude to Professor Ken Peattie, Professor Francisco Lozano and Professor Don Huisingh for
their fruitful critiques and comments, and endless draft revisions.

Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment Sust. Dev. 15, 370–381 (2007)
DOI: 10.1002/sd
Collaboration as a Pathway for Sustainability 381

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DOI: 10.1002/sd