The tragedy of the commons is a situation in which members of a particular community exploit common/shared resources so that the resources are overexploited. The term was first used by economist William Forster Lloyds in a pamphlet published in 1833 and has since been used primarily to condemn the selfishness that results from individualism. The ideology behind the term, while not explicit, fuels today’s environmental panic, particularly in the context of global warming.

Altruism?

The contemporary solution to the tragedy of the commons is quite simple: people should put the common interests above their own particularistic and selfish interests. This is believed to be the THE solution to avoid asymmetries in which certain selfish individuals benefit in the short run while the community suffers losses in the long run. In other words, altruism is the THE (politically correct) solution.

The serious mistake of praising altruism and altruism only stems from the deliberate ignorance of such “altruists” about real life. Not only game theory, but also real-life corporate examples prove that selfish plans must involve altruism if they benefit the agent. The most evolutionarily stable strategies (ESS) are those that incorporate altruism into their selfish game plan.

The concept of “reciprocal altruism” introduced by Trivers suggests that altruism, defined as an act of helping another individual while accepting some cost for that act, may have evolved because it may be advantageous to incur that cost if there is a chance of being placed in a reverse situation in which the individual who was previously helped can perform an altruistic act toward the individual who originally helped him.

Some degree of altruism (as part of a selfish strategy) proves to be a successful strategy in an environment that is inherently selfish according to the laws of evolution. Since man is “just” a part of nature, a part of evolution, this applies to us just as it does to any other part of nature.

One can never avoid interests

Where is the reason for the prevailing misinterpretation of the tragedy of the commons? In the confusion of commons as common property with common agency. Even if one could agree that, for example, the air is common property, that each of us has an equal share “in the air,” that does not mean that one is an owner. One can have a share in a particular common property and act according to the rights that one receives as a representative with the share, but there is no representation of the common.

Suppose all the representatives who own shares decide to elect a representative to take care of the common property. In this case, such a new representative (the agent), by definition, has different interests than the shareholders. Boards of directors, like parliaments (especially individual managers and individual members of parliament), have different interests than their constituents. While this fact is widely accepted in corporate governance, it is not the case in all other cases. For example, a global authority “elected” to manage air has different interests than all of us who have a stake in air, but yet there is a UN authority on air that purports to share our interests.

A single representative can never represent the interests of all representatives who have an interest in common. When he pretends that he does, that is what I would call the comedy of the commons.

As in brains, there is no place that could be described as the place of “I”, so it is impossible for a person to comprehend “everyday things” or to express/verbalize a common interest. We, being inherently selfish beings, elect our representatives (government, parliament, courts…) not because we think they know what is best for society, but because we do not know what else to do. We choose some of them and empower them so that their selfish position acts as a common position for a chosen period of time. To think that they or anyone else could act from a common position is not a tragedy, but a comedy. (Developing tragedy always turns into comedy)

Skin in the game

But there is also a solution to the tragedy of the commons, and a very simple one: skin in the game. Nassim Nicholas Taleb is unbeatable in his explanations of why “skin in the game” resolves all sorts of asymmetries (the short-term gains of certain players are paid for by shared long-term losses). Empowering our representatives without forcing them to have their personal skin in the game deepens the tragedy, contrary to popular belief.

The problem with the tragedy of the commons is not the dichotomy of selfishness and altruism, but the dichotomy of ” skin in the game” or not. Egoists who have skin in the game serve the community best.

This is the fourth revision of the post from 2011, partly abused in Homonism.

Reference:

Taleb Nassim N., 2020, Skin in the Game: Hidden Asymmetries in Daily Life, Random House 2020

Trivers, Robert, L., The Evolution of Reciprocal Altruism, The Quarterly Review of Biology, 35-57, 1971