74 What is a “commons problem”?

Companies (and governments) do not operate in isolation, particularly as to environmental concerns which affect the entire globe. They exist in a global community of other companies and sovereign states. As in all communities, each individual actor has their own motivations or goals and is impacted by the broader shared environment. Though the international system is anarchic—that is, there is no overarching international authority to help promote peace and prosperity among states—each state’s efforts to achieve those goals is to some degree dependent upon the actions of other states in the system. Recognizing that the achievement of prosperity and security requires shared action, the global community sets rules and norms of behavior to give some structure to the anarchic system. This global governance is the process by which sovereign states accrue rights and duties in the international community. 

Like other communities, the international system is tasked with convincing individual members to take some responsibility for solving collective problems. This task is especially difficult when individual members somehow profit from behavior that exacerbates these problems. The tragedy of the commons occurs when there is a rivalry for limited resources to which it is inherently difficult to restrict access and individual states prioritize their own short-term economic survival over broader long-term community interests, interests that are often referred to as collective goods. For instance, if a fishery will only support a limited amount of fishing before collapsing, fishers have a collective incentive to maintain the health of the fishery, yet individual fishers have an incentive to remove all they can and let others worry about the health of the ecosystem. Unless the fishers can cooperate, each fisher may follow their own incentives to catch as much as possible and the fishery will collapse.

Individual states have incentives to take actions in order to secure these goods for their own benefit that may negatively impact others. For example, individual states may prioritize cost savings for manufacturing plants that use the cheapest energy source, even if doing so contributes to continuing damage to the common environment. China, for instance, engaged in rapid industrialization, dramatically increasing the size of its economy and the quality of life for the Chinese people; however, in the process, China became the world’s leading producer of air pollution. Air pollution cannot be contained to the boundaries of the country producing the pollution, and clean air is a collective good. International issues like air pollution, where one state’s actions to mitigate its role in intensifying a problem may be ineffective if its neighbor does not take similar action, illustrate the complexities of the tragedy of the commons.

The anarchic nature of the international system complicates efforts to persuade states to recognize their contribution to a common problem and to take responsibility for their actions. Collective goods benefit everyone, regardless of whether they participate in securing them, and it can be difficult to motivate individual states to make sacrifices to secure those goods if other states are already working on it—a phenomenon called free riding. Through global governance, the international community helps states and people obtain these public goods while maintaining the principle of state sovereignty on which the international system is based.