Thus, a rich heritage of theory and practice in managing abundance and coping with scarcity exists and may be found in the literature of the commons. This heritage was overlooked for several decades after Hardin observed in 1968 that a “tragedy of the commons” ensued when rational gain-maximizers exploited the commons in pure pursuit of self-interest.38 This has led governments to take over these commons as State property or turn them over to corporate interests through privatization, oftentimes creating worse tragedies. What can be worse than the tragedy which befell Russia, when the common wealth of its people - literally the product of their sweat, tears and blood - became private property overnight of Party bureaucrats-turned-capitalists? Subsequent studies have since shown that Hardin's “tragedy” was by no means universal, and that successful practices in managing the commons continue to serve many communities today.39
Hardin's analysis of his herders and pasture example was also too simplistic. Hardin argued that a rational herder would gain for himself +1 unit per additional head, and split with other herders the -1 unit damage to the pasture. He concluded that the positive net gain will drive every herder to keep adding heads to the pasture until the commons collapses. Hardin's risk-blind herder does not take into account the risk to his own perpetual income stream created by each additional head he puts to pasture. A risk-wise herder, weighing the gain from each additional head against the increasing risk of losing his perpetual income stream, will stop adding heads before the probability of losing that income stream reaches 100%, which occurs as carrying capacity is exceeded.
Every herder will get a clear signal as the risk increases, because he will be getting less gain per unit effort as the pasture deteriorates. Here is a self-regulating system that requires no unrealistic assumptions like perfect knowledge or perfect competition.
A foolhardy herder who needs the +1 gain badly enough may still risk not only his own but also everyone else's perpetual income stream. Since each one could, one day, face a similar situation of urgent need, they may eventually realize that it would be better for each herder to contribute a small amount to raise the +1. This suggests, as a long-term solution, a system of insurance or social security, a type of commons that reduces individual risk by pooling resources.
Post new comment