At the end of my last post, I briefly mentioned two famous principles in economics and game theory known as the "Tragedy of Commons" and the "Free Rider" problem. I was talking about a scaled up version of the classic Prisoner's Dilemma when there are more than two players involved and games are repeated more than just once. Just as in the well-described one-time game between just two players, the dilemma arises because the game produces a result in which everyone would be better off cooperating, but they choose not to because it is in their individual interests not to do so.
As it turns out, the so-called "Tragedy of Commons" was described in ancient Greece by the philosopher Aristotle, who said "That which is common to the greatest number gets the least amount of care. Men pay most attention to what is their own: they care less for what is common." The British economist William Forster Lloyd made the observation in 1832 that "the commons" (common land that was owned collectively by all and therefore used collectively by all - the most famous example is probably Boston Common) deteriorated faster than private lands and asked, "Why are the cattle on a common so puny and stunted? Why is the common itself so bare-worn, and cropped so differently from the adjoining inclosures?"
Think about this for a moment and imagine you are a farmer in an 18th century New England town. You have a dairy cow (named "Ole Bessie") that you walk every morning to the town commons to pasture. One day as you drop your cow off (and say "Hello" to some of the other farmers in the town who have done likewise), you notice that the grass on the commons is becoming sparse and comment to yourself, "My the commons is looking awfully brown these days." You also notice that your cow is losing weight and not producing as much milk. You rationalize to yourself that if you purchase another cow, you can make up for Ole Bessie's drop in milk production.
Unfortunately, your new purchase does nothing to alleviate the deterioration of the commons itself. In fact, it's likely to make things worse! Even worse, every other farmer has made the same decision to purchase additional cows to make up for their own drop in milk production. In other words, each farmer chooses what is best for his (remember, in 18th century America the farmers were men) family and not what is best for the rest of the townspeople. As each farmer buys more cows, the common deteriorates further. Eventually, the common can no longer support the herd and everyone is worse off!
The American ecologist Garret Hardin first coined the phrase, the "Tragedy of Commons" in a Science article in 1968. He wrote, "Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit – in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons."
The article has become one of the most cited articles ever published, as well as one of the most heavily criticized for some historical inaccuracy. Hardin later retracted his original thesis and suggested "Under conditions of overpopulation, freedom in an unmanaged commons brings ruin to all" (the key word being "unmanaged" - see his article "The tragedy of the unmanaged commons").
We see examples of the "Tragedy of Commons" whenever free access and unrestricted demand for a finite resource ultimately reduces the resource. Remember, the benefits of using that resource accrue to individuals or small groups, while the costs of the exploitation are borne by all those to whom the resource is available. For example, the "Tragedy of Commons" has been used to explain climate change, pollution, world hunger, overfishing on the Grand Banks, and most recently with vaccines and herd immunity! Next time, in an upcoming post, I will talk about the "Free Rider" problem.
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