The Tragedy of the Commons is a term used to describe a situation in which individuals acting in their own self-interest can unintentionally lead to the ruin of a shared resource. The term was first coined by ecologist Garrett Hardin in 1968, and has since been used to explain everything from overfishing to climate change.
The basic idea behind the Tragedy of the Commons is that humans are hardwired to act in their own self-interest. This is not necessarily a bad thing – after all, it’s what motivates us to work hard and achieve our goals. However, when it comes to shared resources, this instinct can backfire.
For example, imagine that there is a fish pond that is shared by a group of villagers. Each villager is allowed to fish in the pond, and they are all incentivized to do so because it is a free source of food.
However, there is only so much fish in the pond, and if each villager catches too many fish, the stock will dwindle. At this point, the Tragedy of the Commons comes into play – each villager is motivated to catch as many fish as possible before the others do, leading to an overexploitation of the resource.
In the end, the pond is ruined and everyone suffers – even though each individual was acting in their own best interest.
The Tragedy of the Commons can be applied to any situation in which individuals are competing for a limited resource. It is a warning against the perils of short-sightedness and selfishness and a reminder that we must often act in ways that may not be in our immediate self-interest in order to protect the long-term health of our shared resources.
The tragedy of the Commons: Regulation vs Market Forces.
The Tragedy of the Commons is often used as an argument for government regulation. The thinking goes that, since individuals are hardwired to act in their own self-interest, they need to be regulated in order to prevent them from ruining shared resources.
However, there is another way to solve the Tragedy of the Commons – by using market forces.
For example, imagine that the fish pond from the previous example is owned by a single villager. This villager has two options: he can allow everyone to fish in the pond for free, or he can charge a fee for access.
If he charges a fee, then he will only allow people to fish in the pond if they are willing to pay. This means that people will only fish in the pond if they value the fish more than the amount they are paying to fish. In other words, they will only fish if it is in their best interest to do so.
By using market forces, the owner of the pond can incentivize people to act in ways that protect the resource, rather than exploit it.
The Tragedy of the Commons is a complex issue, and there is no one-size-fits-all solution. In some cases, government regulation may be necessary to prevent individuals from ruining a shared resource. In other cases, market forces may be enough to incentivize people to act in ways that protect the resource.
The question is, how do policymakers decide when to use regulation and when to let market forces solve the problem?
This is a difficult question, and there is no easy answer. However, it is important to remember that the Tragedy of the Commons is a warning against the perils of short-sightedness and selfishness. When making decisions about how to solve the Tragedy of the Commons, policymakers must always keep the long-term health of our shared resources in mind.
The other factor to consider is unpriced externalities, which are often linked to The Tragedy of the Commons. For instance, the manufacture of chemicals used to be very profitable, because the private companies privatized all the profits, but passed on the costs of cleaning (or at least not doing anything) the environmental waste product in the manufacturing process. This is called an externality. The solution to this particular form of the Tragedy of the Commons was to tax the chemical companies, so they internalized some of the cost of their pollution. This made it more expensive to produce chemicals and caused a decrease in production (and consumption).
Externalities occur when the price of a good or service does not reflect the true cost to society. The most common type of externality is environmental pollution, which occurs when businesses pollute the air, water, or land without having to pay for the damage they cause.
Externalities can also be positive. For example, if someone plants a tree in their backyard, everyone in the neighborhood will benefit from the shade and beauty of the tree. The person who planted the tree has created a positive externality for the community.
Positive and negative externalities are important to consider when addressing the Tragedy of the Commons because they can have a significant impact on the way resources are used.
There is a significantly more subtle system of externalities going on in modern society, and this is the wholesale capture of our attention by social media companies. Most of these services are free — and so you are the product!
And they really do work for businesses and organizations that want to sell you things. I use Facebook as one of the main platforms to sell my project management software, and every day I have random people all over the world sign up and send me money to use the software, which is amazing.
But, the dark side of these wildly profitable companies is that they need to constantly increase the advertising inventory, and this can only be done by increasing time on the platform and the engagement. This may be actively against your life goals and may cause mental health issues. So while the business model of these companies is not a Tragedy of the Commons, it may be having similar effects on our attention spans, and you could consider it an externality.
Regulation can take many forms, but the goal is always to change people’s behavior in order to protect a shared resource. For example, the government may regulate how much water each person is allowed to use from a shared aquifer. Or, the government may place a tax on carbon emissions in an effort to reduce air pollution.
Policymakers must carefully consider the costs and benefits of regulation before implementing any new rules. Regulations that are too strict may stifle economic growth and innovation, while regulations that are too lenient may fail to protect the environment or public health.
The best way to solve the Tragedy of the Commons is to change people’s behavior. This can be done through education, persuasion, or coercion.
Education is perhaps the most important tool in solving the Tragedy of the Commons. If people understand how their actions can impact the environment or other people, they may be more likely to change their behavior. For example, educational campaigns about recycling or conserving water can help people understand why it is important to conserve resources.
Persuasion is another way to change people’s behavior. In many cases, people are not aware of the environmental or social impacts of their actions. For example, someone may not realize that throwing away a plastic water bottle will pollute the environment. If people are made aware of the negative impacts of their actions, they may be more likely to change their behavior.
Coercion is another way to change people’s behavior, but it is usually less effective than education or persuasion. Coercion involves using force or threats to make someone do something. For example, the government may fine people who litter in an effort to get them to stop. While coercion can be effective in some cases, it often fails to change people’s long-term behavior.
The Tragedy of the Commons is a complex problem that cannot be solved with a single solution. Education, persuasion, and coercion are all important tools that can be used to change people’s behavior. But, in the end, the best way to solve the Tragedy of the Commons is to change the way we think about resources. We need to move away from the idea that resources are unlimited and free for everyone to use. Instead, we need to start thinking about resources as something that belongs to all of us and that we need to conserve for future generations.
This is especially true of things that are not yet quite so tangible, such as the mental health of our children. We are seeing teenage suicides going up in tandem with social media use, but we are yet to do anything about it as a society. It is not quite the same as air or water pollution, but it is an example of how our actions can have negative consequences for future generations.
The Ledger of Harms by the Human Center of Technology is a great resource about the various externalities that social media companies leverage.