Tragedy of the Commons
IntermediateThe tragedy of the commons is a situation in which individuals, each acting in their own interest, overuse and deplete a shared resource, even though this harms everyone, including themselves, in the long run.
The idea was popularised by ecologist Garrett Hardin in a 1968 essay, using the example of a shared pasture. Each herder gains by adding more animals, while the cost of overgrazing is shared by all. If every herder adds animals, the pasture is destroyed.
The problem affects resources that are shared and that can be used up, such as fisheries, groundwater, forests, clean air and the atmosphere’s capacity to absorb greenhouse gases.
For example, if fishing in an area is unrestricted, each boat has an incentive to catch as many fish as possible before others do, which can collapse fish stocks and leave everyone worse off.
Solutions include government regulation, such as fishing quotas; assigning property rights, so owners have an incentive to protect the resource; taxes or charges on use; and tradable permits, such as emissions trading systems. Economist Elinor Ostrom, who received the Nobel Prize in Economics in 2009, showed that communities can also manage shared resources successfully through their own rules and cooperation.
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