{"id":34871,"date":"2015-06-19T12:50:22","date_gmt":"2015-06-19T12:50:22","guid":{"rendered":"http:\/\/vskills.in\/certification\/blog\/?p=34871"},"modified":"2024-04-03T13:18:20","modified_gmt":"2024-04-03T07:48:20","slug":"tragedy-of-the-commons","status":"publish","type":"post","link":"https:\/\/www.vskills.in\/certification\/blog\/tragedy-of-the-commons\/","title":{"rendered":"Tragedy of the Commons"},"content":{"rendered":"

\"Tragedy<\/a><\/p>\n

\u2018Property rights<\/strong>\u2019 is an essential ingredient of market economy. When the society fails to define property rights of using resources and doesn\u2019t allow the highest bidder to use them, what results is known as \u201cTragedy of the commons\u201d. It refers to an inefficient utilization of resources as a result of undefined property rights. The term was first used by G. Hardin who wrote an essay with the same title. The title was inspired by the pamphlet of Oxford economist William Forster Lloyd who had explained in it why the pasture land (a common resource) in England, which was not privately owned, was overgrazed.<\/p>\n

He explained in his paper that because the land was not anyone\u2019s private property and was freely available to all, every herder had an incentive to increase the grazing of its herd to the maximum to get highest benefit. This resulted in overgrazing and it damaged the land completely. If someone was given the ownership of the land then, the result would have been different. The main reason behind this phenomenon is that each herder ignores the social cost it is imposing on others whenever it adds another cow for grazing. When one more cow is grazed on the land it reduces the amount available for others. If all the herders ignore this externality, it results in overutilization of resources.<\/p>\n

Example of Cleanliness:<\/strong> If someone drops a wrapper of chocolate in the public street does anyone care? No, because the streets are not anybody\u2019s private property. No one has an incentive to clean the street because they can leave it to the sweepers. \u201cIf others are not doing then why should I?\u201d This is the attitude of people. Because there is no ownership, there is no incentive to take care. If everyone starts thinking in the same manner then it will result in Tragedy of commons i.e. it will result in dilapidation of public streets.<\/p>\n

How can we avoid the \u2018tragedy\u2019?<\/p>\n