Scholars in the environmental security tradition have sought to explicate the links between environmental scarcity (or degradation) and the onset of different forms of political violence and how these are mediated by institutional mechanisms. The Malthusian trap here is not a direct deterministic relationship, but rather a possibility, where environmental scarcity when it coincides with socio-economic processes of rent-seeking and exclusion triggers political conditions ripe for violent struggles. This a priori attention to scarcity as causal mechanism blurs our understanding why violence occurs in some and does not in other places. Our research strategy is therefore different: we study a case of non-violent relations between resource users under conditions of environmental scarcity (due to drought) and political instability and look into the crucial role of local institutions in governing competing resource claims. Our case from the violence-prone Somali Region, Ethiopia analyses how agro-pastoralist communities develop sharing arrangements on pasture resources with intruding pastoralist communities in drought years, even though this places additional pressure on their grazing resource. A household survey investigates the determinants for different households in the agro-pastoralist community, asset- poor and wealthy ones, to enter into different types of sharing arrangements. Our findings suggest that resource sharing offers asset-poor households opportunities to stabilise and enhance their asset-base in drought years, providing incentives for cooperative rather than conflicting relations with intruding pastoralists.