Tragedy of the commons

The problem of the commons (also called the tragedy of the commons) refers to how a publicly available resource can become run-down because no one has an incentive to maintain or improve it.

For example, imagine a large pasture where any farmer is allowed to graze his cattle. If a farmer wants to produce more milk, he must weigh the benefit of adding a new cow (more milk) to the cost (consuming more grass). For the individual farmer, the benefits of adding a cow, which he shares only with himself, far outweigh the costs, which are shared amongst all the farmers. If every farmer makes the same self-interested decision, eventually there will be too many cows for the pasture, and it will be destroyed. All of the farmers will then be without a place to graze their cattle, and all are worse off for their decision.

Examples

The problem of the commons is not just a theoretical concept. Any time where a group uses a resource which is owned by all (or by no one) the problem of the commons usually occurs. Some examples are:

• Commonly owned land
• Open commercial fishing waters
• Global pollution