HOW DOES one escape a dilemma in which multiple individuals acting in their own rational self-interest can ultimately destroy a shared limited resource—even when it is clear this serves no one in the long run?
In 1968, Science published Garrett Hardin’s landmark article “The Tragedy of the Commons.” Hardin relied on the metaphor of a small English village in the eighteenth century. Each family has a house with a small plot of land for growing vegetables. In addition, there is a large, common area used by all the villagers to graze their livestock. Each villager has a cow or two that provide the family with its milk. The common area is large enough to support the entire village. Then the village begins to grow. Families get larger, and procure an extra cow. New families move in. Suddenly, the common is threatened; it is being overgrazed. Grass is consumed so fast that there is not enough time for it to replenish itself before rains erode the topsoil. Each cow no longer has quite enough to eat, and thus yields less milk than it did before. If the overuse of the common continues, there will be a slow but sure decrease in the number of animals it can support until, finally, it becomes useless for grazing.
We are now dealing with a tragedy of the global commons. There is one earth, one atmosphere and one water supply, and 6 billion people are sharing it. Badly. The wealthy are overgrazing, and the poor can’t wait to join them.
This is an example of what economist Thomas Schelling calls “the tyranny of small decisions” (“On The Ecology Of Micromotives,” The Public Interest 25 [Fall 1971]: 61-98).
Commons problems are marked by conflicts between individual and collective interests and between short-term and long-term interests. There are two approaches to solving the dilemma of making individual and collective interest line up:
- welfare—a moral approach, i.e. we should educate the populace and exhort them to exercise moderation as citizens of the world
- wealth—an economic approach, i.e. we should offer economic incentives for good behaviour and punishments for bad
= a more sophisticated version of the prisoner’s dilemma.
Schwartz holds that iterative (ongoing) and cooperative (dialogic—as well as retaliatory) negotiations with clear costs and incentives are the most successful; cooperators who start out nice (i.e. assume the best and roleplay their opponent’s position) set in train a virtuous cycle, while defectors are doomed to a vicious cycle.
We must beware two inertial factors:
- naïve realism: “the parties tend to think that while they see the issue ‘objectively,’ the other side is biased”;
- reactive devaluation: “they tend also to devalue what the other party offers.”
If we put more on the table, the effects of reactive devaluation can be minimised.
But, problematically, though the participants may do better in the long term in an iterative negotiation, they tend to feel worse in the short term, because they leave the negotiation thinking about all the things they gave up—and may be reluctant to return to negotiate further (i.e. losses hurt more than wins help—see Daniel Kahneman and Amos Tversky, “Prospect Theory: An Analysis of Decision under Risk,” Econometrica 47.2 [Mar. 1979]: 263-92).
However, there are three dynamic factors that mobilise morality, i.e. make the issue about welfare, not wealth:
- Because participants care more about their relative position in a social or economic hierarchy than they do about their absolute position, we can make the process about fairness, i.e. there must be evidence of “shared sacrifice.”
- So participants can feel like they are participating, we can scale tasks down to manageable chunks; this can set up what Timur Kuran calls “informational cascades” (“Chameleon Voters and Public Choice,” Public Choice 53 : 53-78).
- We can focus on what will be lost, not what will be gained (in accordance with prospect theory [see above]), and choose “vivid particulars,” i.e. concrete examples, to engage people (and override our inability to understand probabilities).