The purpose of this paper is to explore the conditions for success of local common property institutions in forestry.
The analysis is based on a case study of the Terai (lowlands) region of Nepal. Common property institutions were
found to be stable despite the presence of inequality, ethnic heterogeneity, and migration into the region. This is due
to the fact that these institutions build upon established systems of authority in the villages, include monitoring and
enforcement mechanisms, and benefit from a supportive legal environment. As far as outcomes are concerned,
common property serves well to protect forests locally; however, many village residents resort to exploiting forests
managed under state property. The impact of common property on poverty alleviation is ambiguous.