A Level Economics AQA Practice Exam

What does the 'Tragedy of the Commons' refer to?

1. The depletion of shared resources due to individual self-interest

2. The over-regulation of public resources

3. The equitable distribution of resources among all individuals

4. The privatization of communal land

The correct answer is: The depletion of shared resources due to individual self-interest

The 'Tragedy of the Commons' is a concept in economics that refers to the phenomenon where individuals, acting in their own self-interest, deplete or exploit shared resources, leading to overall negative consequences for the community or society as a whole. This situation occurs when resources are held in common and are susceptible to overuse, as no single individual has the incentive to conserve the resource. In this scenario, each individual benefits from using the resource to the fullest extent, but when many individuals act on this incentive, the resource can become overexploited. This can lead to depletion of the resource, negative environmental impacts, and ultimately the downfall of the shared resource's availability for everyone. Classic examples include overfishing in oceans, excessive grazing on common land, or pollution of public water supplies. Other choices focus on different aspects of resource management but do not capture the essence of the 'Tragedy of the Commons.' For instance, over-regulation and privatization may arise as responses to the tragedy, rather than representing the tragedy itself. Likewise, equitable distribution addresses disparities in access rather than the dilemma of shared resource depletion that is foundational to the 'Tragedy of the Commons.'