the ‘tragedy of the commons’ as it relates to common resources and the problem of ill-defined property rights, e.g. oceans and the atmosphere

Question 1

Common resource goods

Answer 1

• rival but non-excludable
• consumers cannot be prevented from using it
• one person’s consumption diminishes another’s person’s consumption of it
• stock of fish in a limited fishing area

Question 2

Tragedy of the commons

Answer 2

• in a shared-resource system, individuals act to their self-interests –> depleting/spoiling that resource to everyone’s detriment
• general wellbeing of society is decreases as consumers might not have access to the good

Question 3

Property Rights

Answer 3

• establishing property rights for common resource goods
• converts the common resource into a private good
• hard to define and enforce private property rights