Question

Last time to expain the concept to that 13 year old. What is meant by the term "the tragedy of the commons"? Use an example that a 13 year old would understand.

Answer 1

Solution: Tragedy of the commons is a situation in which all the user of a 'good or resource' act according to their own self-interest compromising the common benefit of that goods to others.

Consider a lake with trout to which an unlimited number of fisherman have access.Each fisherman fishes up to a poiint at which the marginal revenue from fishing is equal to the cost.But the lake is a common property resource-resource to which anyone has free access, and no fisherman has the intensive to take inot account how his fishing affects the opportunities of others.As a result fisherman's private cost understates the true cost to society becauses more fishing reduces the stock of fish, making less available for others.

This problem is known as tragedy of commons.