Multiple Choice
Which of the following scenarios best illustrates a company contributing to the global tragedy of the commons?
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8. The Types of Goods
The Free Rider Problem and the Tragedy of the Commons
Multiple Choice
Which of the following is an example of the tragedy of the commons?
A
Overfishing in a public lake leading to depletion of fish stocks
B
A person benefiting from national defense without paying taxes
C
A consumer choosing not to buy a product due to its high price
D
A company polluting its own private land
Verified step by step guidance1
Step 1: Understand the concept of the tragedy of the commons. It occurs when individuals, acting independently according to their own self-interest, overuse and deplete a shared resource that is accessible to all, leading to long-term collective loss.
Step 2: Identify the key characteristics of the tragedy of the commons in each option: a shared resource, unrestricted access, and overuse or depletion caused by individual actions.
Step 3: Analyze the option 'Overfishing in a public lake leading to depletion of fish stocks.' Here, the lake is a common resource accessible to many fishermen, and overfishing by individuals reduces the overall fish population, harming everyone.
Step 4: Compare this with other options: 'A person benefiting from national defense without paying taxes' is a free-rider problem, not a resource depletion issue; 'A consumer choosing not to buy a product due to its high price' is a market choice, not related to common resource use; 'A company polluting its own private land' involves private property, not a common resource.
Step 5: Conclude that the example illustrating the tragedy of the commons is the overfishing scenario, as it clearly demonstrates the depletion of a shared resource due to individual self-interest.
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