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More On the Tragedy of the Commons

Human behavior is not the same when one must take care of the bills as it is when one forces others to pay them with the fruit of their labors

[Leer en español]

On several occasions I have referred to this tragedy, but it is time that we dedicate a special note to it, given its transcendence and the mania for repeating the phenomenon.

I discount that those who fall into this problem do so with the best of intentions, but that doesn’t change the adverse results. Let’s take a look at the matter in parts. In the first place, the assignment of property rights is essential to use always scarce resources in the most efficient way possible. If we lived in Jauja, and there was everything for everyone all the time, we wouldn’t have to proceed in this direction.

But, as this isn’t the case, it is indispensable to create incentives so that everyone, in order to improve his position, is forced to improve his neighbor’s, be it selling potatoes, computers, medicines or whatever. In this context, the one who is right obtains benefits and the one who is wrong incurs losses. Of course, there is no room in this process for so-called crony businessmen who ally themselves with political power to exploit their fellow men on the basis of privilege.

Secondly, it is very relevant to take into account that to the extent that the state apparatus interferes in prices, it inexorably harms the institution of property, since every transaction implies transfers of property rights. By distorting prices they are naturally disfiguring the only signals the market has to operate, that is, to know where to invest and where not to do so according to people’s demands.

In the extreme -the abolition of property as Communists claim- prices disappear completely and so does the possibility of accounting, project evaluation and economic calculation in general. As I have illustrated so many times, in this situation it isn’t known if it is convenient to build roads with gold or with asphalt, and if someone said that with the gold metal it would be a waste, it is because he remembered the relative prices before the expropriation of lands.

Thirdly, and here comes the tragedy of the commons, what belongs to everyone belongs to no one and the incentives to care for one’s own are not the same if it is said that the good in question belongs to everyone. Behavior isn’t the same when one must take care of the bills as to what happens when one forces others to pay them with the fruit of their labors. Even the way we turn on the lights and drink coffee isn’t the same when we must pay for the service in respect to the situation where others are forced to do so.

Contrary to what we have stated, there is a very unfortunate tendency to deify the collective and to repudiate the individual with the results that are in sight, especially negative for the most vulnerable who suffer the most from the onslaught of waste. No one better than Jorge Luis Borges to illustrate the point: when he said goodbye to his audiences he used to say “I say goodbye to each one, and I don’t say ‘you all’ because ‘all’ is an abstraction, while each one is a reality.”

At the same time, Garret Hardin baptized what was said in Science magazine as “the tragedy of the commons,” but the initial development goes back to Aristotle when he refuted Plato’s communism. Today, the politics of the collective are spreading everywhere to the detriment of the individual, with the result that impoverishment is increasing by leaps and bounds in various areas.

There is a parallel debate regarding the so-called “public goods” that are limited to certain fields, but this time it is not the case to comment on them, I only refer to recent arguments about externalities, asymmetry of information, the dilemma of the prisoner and what is known as the Kaldor-Hicks theorem.

But in any case, beyond these issues, it is necessary to review the unhealthy insistence on collectivizing everything that politicians can get their hands on, starting with the infamous state-owned companies, which is actually a contradiction in terms, since a business venture translates into putting one’s own resources at risk and not those of others by force.

These state activities at the moment of their constitution alter the priorities of the people since in freedom they would have been given another destiny and if they did the same thing that the people prefer there is no sense in intervening, without prejudice to the well-known deficits, quality of services and explicit or implicit obstacles to competition.

The tragedy of the commons is presented as if they were acts of solidarity, without realizing that this virtue only makes sense when carried out with one’s own resources and in a voluntary manner.

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