Caleb Harris: The tragedy of the commons

aThe tragedy of the commons started back in 1968, when evolutionary biologist Garrett Hardin warned us about the damage individuals can inflict the environment. The tragedy of the commons is used to describe the situation where individuals exploit a shared resource, leading to the resource becoming unavailable to some or all.

There are a couple of problems we face with the tragedy of commons. One of them is a free rider problem. We can overcome that problem by taxation and getting people to pay.

Furthermore, politicians know that they will be punished by well-funded interest groups if they decide to allocate a larger share of the costs to specific sectors.

Free markets can establish efficient economic activity, but when they operate in arenas, where they can exploit the commons, the logic of the free market becomes detrimental.

Spending is popular, but taxes to finance spending are not. The tendency is for spending to rise and its financing to be concealed through borrowing and inflation.

For example, virtual retailers encourage customers to search for clothes that fit properly in retail stores that pay property taxes and other overhead costs, and then to buy them online.

bThe factory ships harvest all the fish from the sea, and then the fish are processed immediately after they’re caught. The government has responded to this tragedy by restricting the size of fish that can be caught, and by regulating the size of the holes in the fishing nets. That establishes the number of fish that can be caught, restricting fishing to specific seasons, and protecting the breeding grounds of threatened fish.

In order to make the tragedy go away, the government decided to prevent the tragedy of the commons by granting property rights, so that people have an incentive to protect the value of the property. The government can also pay for the public good, such as the military, which consumes the largest part of the United States budget.

Finally, the end result of the tragedy of the commons takes a long time to prevent. In order for things to work, people will need to stop exploiting their shared resources all of the time.

 

 

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