Two Versions of the Tragedy of the Commons
AbstractThe commons are a one input-one output production process with increasing marginal cost. In the average return game, each agent chooses his input contribution and total output is shared in proportion to individual contributions. In the average cost game, each agent chooses his output share and total input cost is shared in proportion to individual demands. The tragedy is that the non cooperative equilibrium results in inefficient overutilisation of the technology. We prove formally the tragedy when preferences are convex and both goods are normal. This result has not bee proved previously on such a general preference domain. We also show that overutilisation is less severe in the average cost game than in the average return game.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Duke University, Department of Economics in its series Working Papers with number 95-04.
Date of creation: 1995
Date of revision:
Publication status: Published in ECONOMIC DESIGN, Vol. 2, 1997, pages 399-421
Contact details of provider:
Postal: Department of Economics Duke University 213 Social Sciences Building Box 90097 Durham, NC 27708-0097
Phone: (919) 660-1800
Fax: (919) 684-8974
Web page: http://econ.duke.edu/
Other versions of this item:
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Moulin, Herve & Shenker, Scott, 1992. "Serial Cost Sharing," Econometrica, Econometric Society, vol. 60(5), pages 1009-37, September.
- Kitch, Edmund W, 1977. "The Nature and Function of the Patent System," Journal of Law and Economics, University of Chicago Press, vol. 20(2), pages 265-90, October.
- Martin Shubik, 1962.
"Incentives, Decentralized Control, the Assignment of Joint Costs and Internal Pricing,"
INFORMS, vol. 8(3), pages 325-343, April.
- Martin Shubik, 1961. "Incentives, Decentralized Control, the Assignment of Joint Costs and Internal Pricing," Cowles Foundation Discussion Papers 112, Cowles Foundation for Research in Economics, Yale University.
- Romano, Richard E., 1988. "Oligopolistic competition for market share via voluntary excess supply," International Journal of Industrial Organization, Elsevier, vol. 6(4), pages 447-468.
- Glenn C. Loury, 1976.
"Market Structure and Innovation,"
256, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Roemer, J.E., 1988. "On Public Ownership," Papers 317, California Davis - Institute of Governmental Affairs.
- Watts, Alison, 1996. "On the Uniqueness of Equilibrium in Cournot Oligopoly and Other Games," Games and Economic Behavior, Elsevier, vol. 13(2), pages 269-285, April.
- Moulin Herve & Shenker Scott, 1994. "Average Cost Pricing versus Serial Cost Sharing: An Axiomatic Comparison," Journal of Economic Theory, Elsevier, vol. 64(1), pages 178-201, October.
- Leroux, Justin, 2005. "Strategyproof Profit Sharing: A Two-Agent Characterization," Working Papers 2005-04, Rice University, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Department of Economics Webmaster).
If references are entirely missing, you can add them using this form.