tragedy

• Tragedy of the commons


  A situation in a shared-resource system where individual users, acting independently and rationally according to their own self-interest, will ultimately deplete or destroy the shared resource, despite it not being in anyone's long-term interest for this to happen
• Logic of the commons

  1. There is a shared resource with a carrying capacity

  2. Each individual user adds more to the resource to maximize their own benefit

  3. The total cost of overuse exceeds the total benefit, but the individual user only bears a small portion of the cost

  4. This leads to the resource being depleted or destroyed
• Externalities


  • Costs or benefits that affect parties who did not choose to incur those costs or benefits
  • Negative externalities are costs imposed on others
  • Positive externalities are benefits provided to others
• Private property rights


  Can help internalize externalities and prevent overuse of shared resources
• Right to exclude


  A key feature of private property that gives the owner the opportunity and incentive to conserve the resource
• Parcelization (dividing a shared resource into individually owned parcels) is not always a viable alternative to managing land as an unregulated commons
• Communal management of a shared resource is an alternative to both unregulated commons and parcelization
• Parcelization


  A viable alternative to managing land as an unregulated commons
• Parcelizing western rangeland was not feasible before the invention of barbed wire
• Communal management


  Another option besides parcelization for managing land
• Communal management of land

  1. Pooling flocks/land

  2. Considering impact of adding 101st sheep rather than 11th

  3. Internalizing external costs

  4. Respecting land's carrying capacity
• Open access commons


  A community is not able to restrict the inflow of new users, making tragedy more likely
• Commune


  A restricted-access commons where property is owned by the group rather than individuals
• Successful medieval commons


  • Swiss commons with records dating back to 13th century
  • Cattle grazed in communal highlands in summer, crops grown on individual plots in valleys
• Successful commons


  • Flexible and under local control
  • Rules sometimes need to change in response to circumstances
  • Members internalize rewards of collective responsibility
  • Right to exclude non-members
• Hardin viewed commons tragedies as problems for which there is no technical solution, only "mutual coercion, mutually agreed upon"
• Global human overpopulation has not followed Hardin's predictions, with population growth rates falling in many countries
• Society's institutions evolve in response to commons problems, but remedies are often imperfect
• There will always be commons problems in a world filled with producers, consumers, emerging technologies, and public spaces
• Tragedy of the Commons


  When a resource is not owned, usually nobody has a clear incentive to protect it
• Tragedy of the Commons

  • Resources not owned have no direct benefit for the time, effort, and money invested in its protection
  • Without ownership, everyone can access the resource
  • Lead to overuse
  • People focus on the benefits without taking into account the condition of the resource
• Tragedy


  Refers to anything really bad
• Commons


  Land or resources (water or land) accessible to all, with benefits, but nobody has an exclusive claim to it
• Commons


  Land or resources owned, managed by, or impacting the entire community
• Categories of Nature


  • Inexhaustible Resources
  • Renewable Resources
  • Exhaustible/Non-renewable Resources
• Inexhaustible Resources


  Can last forever in the human time scale
• Inexhaustible Resources


  • Solar energy
  • Air
  • Soil
  • Tides

  
• Renewable Resources


  Used repeatedly, replenished through natural processes as long as it is not used up faster than nature can renew it
• Exhaustible/Non-renewable Resources


  Exist on a fixed amount, stock in the earth's crust
• Carrying Capacity


  The number of animals the land can sustain more or less indefinitely
• Carrying Capacity is problematic
• The Logic of the Commons

  1. Land

  2. Carrying Capacity

  3. Owned by 10 shepherds

  4. 1 shepherd adds 1 more animal

  5. 101 animals exceed the land's carrying capacity

  6. 1 shepherd receives 100% of the benefit, 10% of the cost

  7. 9 shepherds receive 90% of the benefit, suffer 90% of the loss
• Externalities


  "External" or "Spillover" costs - a decision imposed by someone other than the person/group making the decision, affecting all other individuals who did not agree to this cost
• Cost is internalized


  The arrangement is altered so that decision-makers now bear the entire cost of their decisions, helping let each individual take into account all the costs associated with their decisions
• Property institutions


  • Internalize externalities, prevent people from shifting the cost of their activities onto others
• Property regimes should involve

  • Internalizing externalities
  • Dealing with "positive" externalities associated with productive effort
  • Dealing with "negative" externalities associated with the misuse and overuse of commonly held resources
• Unmanaged Commons


  Individual shepherds decide whether or not to step up the intensity of their resource use, do not take full responsibility for the overuse, the cost falls mainly on other members of the group of communal users
• Private Ownership


  • Gives an owner a right to exclude
  • Gives an owner the opportunity to conserve a resource
  • Provides an incentive, whatever owners save, they save for themselves
• Private Ownership


  Cut jointly owned territory into ten smaller land, each shepherd owns a land with its own individual carrying capacity, damage is concentrated on the offender's own private land
• Communal Arrangement


  • A community of ten people devise and enforce rules governing the land's use, instead of each tending a small flock of ten sheep, pool flocks and become joint owners of a single large flock of one hundred, ten shepherds has a self-interested reason to respect the land's carrying capacity