Tyranny for the commons man.

• Author: Schwartz, Barry

How does one escape a dilemma in which multiple individuals acting in their own rational self-interest can ultimately destroy a shared limited resource--even when it is clear this serves no one in the long run?

In 1968, Science published Garrett Hardin's landmark article "The Tragedy of the Commons." Hardin relied on the metaphor of a small English village in the eighteenth century. Each family has a house with a small plot of land for growing vegetables. In addition, there is a large, common area used by all the villagers to graze their livestock. Each villager has a cow or two that provide the family with its milk. The common area is large enough to support the entire village. Then the village begins to grow. Families get larger, and procure an extra cow. New families move in. Suddenly, the common is threatened; it is being overgrazed. Grass is consumed so fast that there is not enough time for it to replenish itself before rains erode the topsoil. Each cow no longer has quite enough to eat, and thus yields less milk than it did before. If the overuse of the common continues, there will be a slow but sure decrease in the number of animals it can support until, finally, it becomes useless for grazing.

We are now dealing with a tragedy of the global commons. There is one earth, one atmosphere and one water supply, and 6 billion people are sharing it. Badly. The wealthy are overgrazing, and the poor can't wait to join them. Examples are plentiful: the overharvesting of trees by lumber companies; the overplanting of land by farmers; the overdevelopment of suburban communities; the extraction of petroleum from a common pool by oil companies; and the overcrowding of highways and other public facilities. These behaviors make whatever benefits users derive from those resources vanishingly small. The issues are as far ranging as contamination of water by toxic wastes, pollution of the atmosphere by carbon dioxide and various particulates, and profligate use of water and energy. Now we must tackle the global-commons problem before the line on Al Gore's global-warming graph reaches the moon.

From the point of view of an individual villager, since he needs the milk from his two or three cows even if they produce less than before, less is better than nothing. Besides, how much difference will it make if he alone shows restraint in his use of the common? Indeed, his temptation might be to add still another cow to make up for this setback. The slow decrease in overall dairy-product yield in the village has little impact on him, especially in comparison to how he would be affected if he stopped using the common altogether. What would be best for this villager is if everyone else in the village showed restraint. Then he could continue to use the common as before, with plenty of grass to take care of his cows. He could, in this way, be a free rider on the moderation shown by others. But of course, everyone would like to be a free rider. The result is that none of the villagers modify their behavior, and the common is destroyed.

Rational individuals (and states) will always benefit by being free riders in the short term. If you do the right thing, you lose; you're a sucker. Doing the wrong thing at least keeps you even. In the long term, when you decide to keep yourself even with others, you (and everyone else) still end up worse-off than before. As the common erodes, it becomes less able to sustain those who depend on it.

There is an important and quite general feature to the commons problem--what economist Thomas Schelling called "the tyranny of small decisions." When deciding whether to add another cow to your herd, you are not choosing to destroy a common resource in order to get a little more milk. Faced with that choice, you might refrain. The choice you see is a little more milk in exchange for a little less grass. Good deal. So, commons problems are marked by conflicts between individual and collective interests and between short-term and long-term interests. It is from this tragic dilemma that we must escape.

One approach to the commons problem appeals to the moral side of people and states. It suggests that we should educate the populace about the dangers and social costs of pollution, wanton use of energy and public lands, and the like, and exhort them to exercise moderation as citizens of the world. In theory, if we tell people the right thing to do--and show that if they all adhere to a set of behaviors, the world will be better-off we can count on them to act morally. But such appeals are unlikely to have a broad-enough influence to do the job. Some people will do the right thing simply because it's the right thing, but many others will not curb their habits, desires, and need for more and better. This is true even within a society that shares at least some values. Globally, a strictly moral appeal is close to a nonstarter (though, as I will suggest at the end of this article, finding a way to moralize the global commons effectively could be quite powerful).

A second approach appeals to our self-interested side, offering incentives for good behavior and punishments for bad. It amounts to using various economic tools to privatize the commons. So nonpolluters and energy conservers get tax breaks. And polluters pay fees for the privilege. President Obama's cap-and-trade plan for reducing greenhouse-gas emissions is a ready example. And we already see this logic in effect domestically on a small scale. Purchasers of inefficient automobiles pay a luxury tax. Tobacco and alcohol are taxed to help defray the social (medical) costs of their use. Permits are sold to regulate the use of parks and beaches. Fees (tolls) are charged for highway use, and they can be scaled so it is almost...