Self-Governance As Co-Production of Rules

Source: EconLog
by Vlad Tarko

“The commons are the typical example in which self-interested individual actions do not aggregate into beneficial collective outcomes, as judged by members of the community themselves. They are the main counter-example to Adam Smith’s logic of the invisible hand, according to which self-interested consumer and producer behavior in markets lead to efficient aggregate outcomes (again, as judged by the people themselves). … Tragedies of the commons are so ubiquitous in daily life that it’s tempting to ultimately frame any kind of social problem as a type of tragedy of the commons. Two salient features are that they are situations in which it is relatively easy to create the problem (and there are individual-level incentives to create the problem), and it is relatively difficult to organize a solution and profit from delivering a solution.” (06/03/24)

https://www.econlib.org/library/columns/y2024/tarkoselfgovernance.html