Shots of Knowledge: Today in Economics: The Tragedy of the Commons

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  • 7 years ago
  • Posted: April 9, 2015 at 10:02 pm

The tragedy of the commons is an economic theory by Garrett Hardin, which treats that individuals acting independently and rationally according to their own self-interest behave contrary to the best interests of the whole group by depleting some common resource.

For instance, a Common-Resources Pool would be a savings group that derives from the leveraging of a common natural resource-for instance, oil.


In such a Commons, there are usually designated roles in a bid to ensure efficient structure. A typical role would be the Treasurer who controls the finances of the Commons. The tragedy of the Commons would be for the Treasurer to embezzle group funds in non-approved outlays, eroding pool funds.


Such common-pool resources would be better protected by oftenly electing new leaders to avoid monotony and the taking advantage of the system. Design efficient development of documentation to trace funds, preventing such situations as embezzlement.





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