Tragedy of the Commons
Tragedy of the commons refers to a situation in which members of the community, if acting in isolation, find themselves in particular prisoners’ dilemma Opens in new window.
The tragedy of the commons can be observed where a large number of people use commonly owned resources, each of whom can benefit by exploiting the common resource to the fullest for their own benefit. If all act like this, the tragic situation arises that the resource gets destroyed. This may be the case with fish stocks in the open seas.
Painting a scenery of tragedy of the commons, a group of people may exploit a common asset, for example when their cattle graze on community-owned land. As long as resources are bountiful in relation to the demand, grazing land is not scarce. But as the number of users goes up—for example with population growth—grazing has to be rationed.
Internal, informal constraints tend to do the trick in small communities, where everyone knows everyone else and spontaneous castigation of those who overgraze work informally at the interpersonal level.
It has been found that informal constraints tend to work satisfactorily within groups of up to 50 or 70 members (Hardin, 1968; Ostrom, 1990, 2005).
If the group is bigger, individuals become anonymous, information about individual behavior (behaviour) is insufficient and informal restraints on individuals (such as damage to their reputation) cannot control the excessive exploitation of the commons.
As a consequence, overgrazing occurs and the land deteriorates. Then, some authority administering external rules has an advantage; in our example a government authority could allot limited grazing rights to each member of the community. Another solution would of course be to divide the commons into private properties, which fences can protect.
The tragedy of the commons has also been the case in the Sahel area of Africa where the first Landsat photos taken from space in the 1970s showed that commonly owned land was severely drought affected, whereas private, fenced-off properties conserved a decent vegetation cover.
The tragedy of the commons was in this case that starvation set in and desertification took over where the land was not owned privately (Hardin, in Henderson, 2008/19933, pp. 497 – 499).