key term - Tragedy of the Commons

Definition

The tragedy of the commons is an economic concept that describes a situation where individuals, acting independently and rationally in their own self-interest, deplete or degrade a shared resource. This occurs when there is no regulation or ownership over the resource, leading to its overuse and eventual collapse.

Related terms

Common Pool Resources: Common pool resources are natural resources that are collectively owned or accessible by a group of individuals, such as fisheries, forests, or grazing lands.

Externalities: Externalities refer to costs or benefits that result from an economic activity but are not directly accounted for by those involved in the activity. In the case of the tragedy of the commons, negative externalities arise when one person's use of a resource negatively impacts others.

Sustainable Resource Management: Sustainable resource management involves implementing strategies and regulations to ensure long-term availability and responsible use of natural resources while considering ecological, social, and economic factors.