Tragedy of the Tragedy of the Commons
* Essay: Achim Lerch: The Tragedy of the “Tragedy of the Commons”
"When we deal with the question of the common use of resources, The Tragedy of the Commons almost automatically comes up. The metaphor was coined by the American biologist Garrett Hardin in one of the most influential articles in the social sciences. The tragedy of the commons lies in the expectation that a resource will be overused when it is part of a “commons.”11 Hardin uses the example of a jointly used pasture which is overgrazed by rational herdsmen because they are able to completely privatize the benefit of a larger herd while passing on the costs of overgrazing to all the herdsmen. Hardin was by no means the first to formulate such a theory.
Aristotle already noted in his Politics that the least amount of care is given to that which jointly belongs to the greatest number of individuals. Thomas Aquinas also pointed out this problem. In 1833, William Forster Lloyd outlined a theory on the careless use of common property, which Hardin cites. In 1954, a similar problem was described by H. Scott Gordon in connection with the fishing industry. In his essay The Economic Theory of a Common-Property Resource: The Fishery, Gordon arrives at the now famous conclusion: “everybody's property is nobody's property.”12 Still, Hardin‟s article is viewed as the reference when it comes to questions of common ownership of natural resources.
Hardin applies his metaphor primarily to point out problems of overpopulation and the increasing pressure that it places on resources as well as the problem of environmental pollution. Yet he himself, by the way, doubts the possibilities of countering the tragedy of “the commons as a cesspool” through private property rights.13
Not least, Hardin‟s image of the overgrazed pasture resulted in a widely uncritical reception and transfer of the tragedy of the commons to numerous situations of collective resource management.
From a historical view, however, the metaphor needs to be seen in relative terms:
For example, the British historian Dahlman disputes that the cited tragedy actually occurred in the medieval open field system in England. The same can presumably be said for other countries. Various forms of commons management existed over centuries in northern Europe.14
According to the central theory of Hardin‟s critics, overuse was generally prevented within these systems through a sophisticated structure of norms practiced by the respective communities. “The existence of common property was (. . . ) historically always linked to certain rules set by the community which prevented misuse of common resources.”15 This restriction also pertains to current examples of common use of resources, as Elinor Ostrom in particular shows.16 The tragedy of the commons has turned into a kind “ineradicable myth,” as even sharper critics have described it. Referring to Hardin‟s analytically flawed description and quoting the crucial passage on page 1244,17 Partha Dasgupta, an economist at Cambridge, for example, comments that it is difficult to find a passage of comparable length and fame that contains so many errors as the one quoted.18 Aguilera-Klink even talks about conceptual errors in Hardin‟s article that are consistently repeated by economists. She laments that possibly only a few have read much more than the title of the essay.19
Precisely because Hardin ignores the rules and norms that could possibly prevent overuse of common property resources, what he describes is in fact not a tragedy of common property structures but rather a tragedy of open access regimes.20 One must also see Bromley‟s comment in this context, when he says it would be difficult to find an idea (a concept) that has been as misunderstood as that of the commons and common property.
- There is no such thing as a common property resource – there are only natural resources controlled and managed as common property, or as state property, or as private property. Or, and this is where confusion persists in the literature, there are resources over which no property rights have been recognized. The latter situation is one of open access (res nullius).21
Stevenson, who dedicates an entire book to common property economics, likewise points out a confusion of definition and then proceeds to clearly distinguish open access from common property in theoretical and conceptual terms.
Even though one should think that the main difference between common property and open access is now sufficiently known, the confusion persists. Just to name one of many examples, a reputable and otherwise outstanding and widely read textbook on microeconomics incorrectly defines “common property resources” as “resources to which everyone has open access.”22
If common property, in contrast to open access, is perceived for what it is – a form of common property for which clear institutional rules of use and restrictions on access exist – then it becomes evident that the problem of overuse, or the incentive to overuse, must be viewed in a more nuanced manner. Here, one must differentiate among various cases:
First, it is possible for rules of access and use to be insufficiently defined, in other words, the proverbial “backdoor” is left open, thereby creating incentives for overuse. This case is clearly different from situations where overuse of the resource is based on the violation or breach of existing rules. It would be hyperbole to call this the “tragedy of the commons” (and thereby imply a structural flaw in the property rights structure), just as it would be hyperbole to interpret theft of private property as the “tragedy of private property.”23 Rather, it is a problem of control and enforcement of existing property rules.
From the simplistic structure of this erroneously understood “tragedy of the commons” follow similarly simplistic recommendations for action. According to Ostrom, they essentially assert that problems of common resources can be resolved only either through a “Leviathan” system (in the sense of a strong government; sometimes, even an “eco-dictatorship” is suggested) or through total privatization. The work of R. J. Smith, senior fellow at the National Center for Public Policy Research, a conservative American think tank, is typical of this approach. For Smith, the problem of how to manage biological resources can be solved by answering obvious questions such as, Why was the American buffalo nearly exterminated but not the Angus or the Jersey cow? Why are salmon and trout overfished in the nation‟s lakes and rivers and streams, while they thrive in private fish farms and private lakes? He promptly offers up the answer:
- In all these cases, it is clear that the problem of overexploitation or overharvesting is a result of the resource‟s being under public rather than private ownership. The difference in their management is a direct result of two totally different forms of property rights and ownership: public, communal, or common property vs. private property.
So, according to Smith, the American salmon are disappearing from most rivers or are being heavily depleted because they are being treated as part of the “common heritage of mankind” and, as a “common property resource,” they belong to everyone, can be caught by everyone, and essentially belong to no one. The (northern) European salmon, by contrast, are in much better shape, he asserts, because “some of the finest stretches of rivers are owned or leased by individuals, groups of fishermen, or fishing lodges, and the salmon are not overfished.”24
This view of common property clearly describes more an open access condition along the lines of the above distinction in terms, while common property for clearly delineated communities (i.e. a group of fishermen!) is deemed private – instead of – collective property. One of the pioneers of environmental economics, K. William Kapp, expressed the concept much more clearly, long before Hardin:
- Wild und Fisch gelten nach amerikanischem Gesetz als freie Güter, bis sie gefangen bzw. Erlegt sind. Die Tatsache, dass Eigentumsrechte nur auf erlegte und gefangene Tiere geltend gemacht werden können, macht diese „flüchtigen‟ Ressourcen besonders anfällig für die Ausbeutung durch private Jäger und die kommerzielle Fischerei. Die Tatsache, dass Ressourcen frei und weder Gemein- noch Privateigentum sind, verleitet den einzelnen Jäger oder Fischer dazu, seinen Fang zu maximieren, weil ihm sonst sein Konkurrent zuvorkommt.25
Another approach would be to question the assumptions about behavior put forth in the parable of the “tragedy.” That, in certain situations, there are incentives to maximize one‟s own benefit even at the expense of others (co-owners) does not necessarily mean that these incentives always determine actual behavior. Rather, the results of experimental economics of the past years indicate that individuals can indeed be assumed to show a general willingness to behave cooperatively. This willingness does, however, threaten to fade whenever cooperative behavior is repeatedly “punished” by the uncooperative behavior of others (also individuals). It is therefore especially important which specific (sanctions) rules are tied to various forms of (common) property.
In the case of open access, a distinction is to be drawn between the case of complete open access and situations where the number of resource users is limited but individual use of the resources is not. According to Stevenson, this case of “limited user open access,” like “complete open access,” also ultimately leads to overuse.26 A pure access limitation, that is, a limitation on the number of users, therefore would not be sufficient. Additional rules are thus needed in order to sustainably manage a common property resource in an open access situation.
For Stevenson, a “private property, common property, open access trichotomy” ultimately exists. He compares these three forms in terms of group limitation and extraction limitation.
Characteristic of the common property form is that both the group and the extent of resource use are limited by the individual members:
(GRAPH IN ORIGINAL)
Thus, two essential findings of this analysis are important to the discussion on the commons: First, a clear distinction is to be made between resources owned in common (common property) and resources for which no property rights have been defined (open access). Second, the much quoted phrase “tragedy of the commons” is, at best, unclear because it frequently describes not a tragedy of the commons but a tragedy of open access.
With a view to the destruction of tropical rain forests, Bromley accordingly states that the real tragedy of the commons is the process whereby the property rights structures of indigenous peoples is undermined and delegitimized.27 This assessment is also shared by the U.S. National Research Council: “This is the real tragedy of the commons: traditional management systems that were effective for thousands of years became obsolete in a few decades, replaced by systems relentless exploitation of rural people and rural countries.”28 “. . .the collapse of traditional common property regimes and open access to resource exploitation leaves rural communities hardly any means to maintain sustainable resource management.”29
Thus, the question concerning the efficiency of common ownership of resources, which is often hastily answered with the argument of the “tragedy,” remains, in principle, open. Every allocation of property rights, whether private or common, is associated with costs from an economic perspective. Which property rights option will ensure efficient resource use will depend in each individual case on these transaction costs.30 “Not only is common property distinct from open access and from private property, but it can be a solution to the open access problem, even as private property is,” Stevenson believes.31 In the literature, numerous cases are analyzed, where collective property rights are preferable to private property rights: “Common property is the preferred solution to open access when the resource is unamenable to being split into individually controlled units, the control costs of sole ownership are prohibitive, or the technological characteristics of production (e.g. economies of scale) favor it over private property. It may also be preferred when social or cultural factors favor a group over an individualist solution.”32 (http://www.boell.org/downloads/Lerch_Tragedy.pdf)
- Garrett Hardin: The Tragedy of the Commons