Tragedy of the Commons
The tragedy of the commons is a situation in a shared-resource system where individual users, acting independently according to their own self-interest, behave contrary to the common good of all users by depleting or spoiling the shared resource through their collective action.
Ostrom identified some models that attempt to explain why common resource allocation will fail without intervention:
Prisoner’s dilemma : A game where two individuals do not cooperate, even though they rationally ought to
Tragedy of the commons : Individuals in the commons act according to their personal interest, thus depleting the resource
Free-rider problem : Individuals enjoy a benefit without contributing back, because there is no cost associated with doing so
Ostrom showed that a commons could be effectively managed by the community of users, without centralised regulation provided that:
- Membership boundaries are clearly defined.
- The rules that govern the commons should match the actual conditions.
- Those who are affected by these rules can participate in modifying them.
- Those who monitor the rules are either community members or are accountable to the community, rather than outsiders.
- Those who violate the rules are subject to graduated sanctions, which vary depending on the seriousness and context of the offense.
- Conflicts should be resolved within the community, using low-cost methods.
- External authorities recognize the right of community members to devise their own institutions.
- If the commons is part of a larger system, its governing rules are organized into multiple “nested” layers of authority
Advocates of systems-thinking such as Gene Bellinger  identified the Tragedy of the Commons as a common archetype in complex systems, arising where the individual benefits to two or more actors are based on consumption of a shared resource.
#todo extend with some stock/flow modelling