The Tragedy of the Commons

Hello readers,

            Today I’d like to present my thoughts on the present-day relevance of Garrett Hardin’s classic discourse entitled “The Tragedy of the Commons”. Written in 1968, the article was the first attempt at a solution for common resources. Economists define common resources as non-excludable (there are no property rights, therefore anyone can use them) and rivalrous (one person’s consumption limits the consumption of another person).

            Hardin’s example involves a pasture open to all and a number of herdsmen who will keep as many cattle on the pasture as possible. The size of the land is fixed, and eventually the pasture will become over populated, as each herdsman will benefit from continuing to add cattle. The rationale of the herdsman for adding an additional animal is as follows:

Positive: The herdsman receives all the proceeds from the sale of the additional animal

Negative: The additional overgrazing created by the one more animal. The effects of this overgrazing are shared equally by all the herdsman, thus making the private cost to the individual herdsman a fraction of the total social cost to the pasture as a whole.

            Given the incentive, each individual herdsman will continue to add cattle even though it is harmful to the pasture as a whole.

            I have brought forth the example of the Tragedy of the Commons, because it applies directly to the problem of pollution. Pollution is the reverse of Hardin’s pasture, rather than taking something out of the commons, we are putting in. The problem is that what we are putting in­­—greenhouse gas emission into the air, sewage and chemicals into the water— is harmful. And the pollution continues as the rationale man finds his share of the cost of the waste he pollutes into the commons to be less than the cost he would face to purify his wastes before releasing them.

             It becomes obvious that pollution will continue until it becomes cheaper for each polluter to treat his pollutants than to discharge them untreated.

The question becomes—How do we make it cheaper to treat pollutants/not pollute than to pollute?

-       A tax is definitely needed. Given that rich people and nations pollute the most, I propose a stepped-tax system either with higher taxes in wealthier nations/regions, or with the tax increasing at higher levels of pollution/emissions. It might be as simple as taxing less fuel-efficient vehicles substantially more. The key here is that the tax must make it cheaper not to pollute. In practice, this has been difficult to establish; for example, carbon taxes have had little effect on reducing emissions as they are to low.

Let me know if you have any other ideas,

AC