The Tragedy of the Commons: How Elinor Ostrom Solved One of Life’s Greatest Dilemmas


This week, I’m sharing about a topic close to my heart – Tragedy of the Commons. I often wondered how we, as humans, would ever get around this problem. Turns out, it’s already solved by Nobel Laureate, Elinor Ostrom.

This article is heavy, especially if you haven’t been exposed to these topics before. So I suggest you go get yourself a hot drink and settle in…

🤔 What’s the tragedy of the commons? 🐮

It’s a concept first introduced as a parable about villagers sharing a common pasture. Everyone has an implicit responsibility/agreement to only let their cows graze as much as needed. Because if all farmers let their cows overgraze, there would soon be no more grass for anyone.

The problem is that individual farmers are highly incentivised to overgraze, because that leads to fatter cows that fetch a higher price at the market. However, once that happens, it sets off a competitive, FOMO cascade leading to everyone overgrazing, which soon destroys the farmland. In the long run, everybody loses.

In short, it’s a concept that says all unregulated commons become overused in time. Examples include our overfished seas, oil extraction or even free sauce packets at your local fast food chain.

The Tragedy of the Commons: How Elinor Ostrom Solved One of Life’s Greatest Dilemmas – Evonomics
The design principles for solving the tragedy of the commons can be applied to all groups. Read more.
The Tragedy of the Commons: How Elinor Ostrom Solved One of Life’s Greatest Dilemmas – Evonomics
The design principles for solving the tragedy of the commons can be applied to all groups. Read more.

I used to think there wasn’t a way around it. That the only way to fix this is regulation, which, as we all know, is never perfect.

It’s quite depressing to think that everything always ends up in a “you’ve ruined it for everyone. This is why we can’t have nice things” situation.

As it turns out, that’s not the case! Elinor Ostrom found out that groups are capable of avoiding the tragedy of the commons without requiring top-down regulation.

Here are the 8 core principles she defined as necessary to make self-organising groups work:

  1. Clearly defined boundaries
  2. Proportional equivalence between benefits and costs
  3. Collective choice arrangements
  4. Monitoring
  5. Graduated sanctions
  6. Fast and fair conflict resolution
  7. Local autonomy
  8. Appropriate relations with other tiers of rule-making authority (polycentric governance)

The best thing about it is that it’s not just theoretical. It actually works! They’ve tried it on various groups like a neighbourhood park, school district and church and it worked.

Another cool thing to note is that they discovered evolution isn’t just survival of the fittest individual in the group. Instead, groups can become so cooperative that they become an organism itself and evolve to survive as a mutually-reliant group.

Imagine the implications! If I had time, I’d love to spend months digging into this. But alas…

Seeya next Monday,

Lesley

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