Managing Today’s Global Economy

Following the path-breaking work of Coase (1960), economists have recognised the complex issues of managing jointly owned and utilised properties, so-called commons. Increasingly we see this as a problem of externalities, as with public goods. We recognise the wide range of occurrences, ranging from small public sites – visualise an overcrowded public park – to worldwide issues, like global warming, and we observe the diverse ways in which these resources are being managed or mismanaged. This article suggests that the global economy is also a commons, one whose management poses special challenges. The current world situation suggests the urgent need to recognise this fact and to devise ways to reconcile the interests of various participants in an increasingly integrated global economy.