Tragedy of the Tragedy
The difficulty facing the Tragedy of the Commons
Public goods are non-rival, non-owned goods wherein “each individual’s consumption of a good leads to no subtraction from any other individual’s consumption of that good.” This would mean that public goods, such as air, ocean waters, forests and natural resources available from these environments are owned by everyone and available to anyone. They are therefore non-excludable “common” goods: every person has the right to access and use of these goods, because theoretically, he has partial ownership of it.
The problem with common goods is that because everyone owns it, rational choice would entail a person to evade responsibility of it. If, for example, a person would want to clean up a national park, he would do so using his own resources and efforts; however, while he utilizes his own resources, other people who did not help him clean up are still benefiting from his efforts. And because the park is a public good, his efforts to clean up will not ensure him a clean park afterwards; other people can opt to use it and bring it back to disarray. A rational decision would therefore be to not clean up the national park, because the costs (time, effort, money, the possibility of the park to be dirty again) would be more than the benefits (a trash-free public park).
In another perspective, cheap and unregulated access to common goods entails the public to abuse these resources until no resources are left to extract. In economic terms, exploitation would result to equality between marginal returns and marginal costs.
This is why the parable of the commons is a tragedy: while public goods are ideally for everyone, not everyone can have access to it because of utility maximization: rational actors would use these resources for their private interests, without thinking of the benefit of others.
In studying this tragedy, recommendations of privatization and public administration of the commons come to mind. These options would entail regulation of the resources, which will limit access of the public, but is an ideal alternative than opening the commons to abuse. However, we come to another dilemma: how do we make sure that private companies or the government do not abuse regulating power and use it for their own private interests?
Take for example, farmland ownership in the Philippines. Before the concept of land properties was born, farmers tended to plant crops on the land nearest to their homes; there was no sense of ownership of the land, but there was an unwritten agreement that it was their responsibility. When the feudal system was brought by the Spanish, it became clear that the landlords were the owners; the farmers, who once planted wherever they wanted, are now only tenants—borrowers of the land.
If they do not own the land, therefore, a single farmer’s efforts only has a trivial effect on a bountiful harvest , and the success of a good harvest is a collective good to which each farmer is entitled regardless of effort. Left to pursue their own interests, therefore, the farmers take no concern in reaping a harvest, because the money goes to the landlord anyway. The farmers only work hard because of external factors: the threat of starvation, as payment for rent, or physical abuse.
This example shows that the option to make the commons remain as unregulated goods and the option to have it privatized or government-owned, brings its own costs and benefits. Abuse is therefore inevitable; rational actors would continue to pursue their own interests, subject to the degradation of environmental resources.
However, experience and empirical studies show that actors do not always act based on rational underpinnings—there are actions that are based on past experiences. Some actors make decisions based on how they experienced similar situations in the past, or as a result of trial-and-error.
Concretely, and in the context of the tragedy of the commons, the institutionalization of laws pertaining to the care for public goods comes to mind. Rational choice theory does not explain why there is a Clean Air Act, and why there are individual revolutionaries (i.e. Al Gore) and institutions (i.e. Greenpeace) who seem to direct their efforts in the preservation of the environment. Using this perspective, we see a positive outlook that makes the parable less of a tragedy: if there are actors who decide to surrender the costs to reap the benefits, then maybe the tragedy of the commons isn’t so tragic at all.
A more concrete example: the recent launching of TNT Express, a private international express service company, of Planet Me, an environmental advocacy of the company to reduce carbon emissions of the company. Local efforts of TNT Express in the country are evident in the recent tree-planting activity of its employees in Mt. Makiling, a regular monitoring of electricity and water bills, a proposal of carpooling in employees and the resort to biofuel in their vehicles and planes. To formalize these efforts, TNT Philippines decided to create an environment management committee that will ensure these proposals are put into practice, and not just remain on paper.
As a profit-oriented institution, this would make TNT Express an economic loser in the short run—a new committee entails more employees to hire, biofuel is more expensive than regular fuel, and sending employees out of town to plant trees would take the time off from the office, where they should be working. However, the company sees this as more beneficial in the long run. Using biofuel, even if it is more expensive, means less carbon emissions in the atmosphere, which lessens environmental damage. These results may not be seen within the span of ten years; nevertheless, it does make a difference. A big step from an international private company like TNT Express also becomes a role model to other companies, who are already being pressured by environmental groups to resort to environment-friendly measures.
