The Ethics of the Commons

For almost two centuries, the economic theory known as the Tragedy of the Commons has been used to explain the negative consequences of a completely self-serving standard of behavior on the community at large. The term derives from the idea that if individual townspeople were to use up all of the grass available on the commonly-held pastures there would not be anything left for their neighbors to use for grazing, and therefore the long-term interests of the entire community would be better served by sharing and conserving those resources. A more modern example would be the collapse of the North Atlantic fisheries due to over-fishing, which has decimated an entire industry in the American Northeast. But in recent times this concept has become increasingly obscure, given that it runs counter to most of the common strategies of a Free Market economy, where everyone is assumed to be trying to maximize their own short-term profits at the expense of all competitors. Given some of the recent developments in both the political and economic conditions in this country, and several others around the world, it seemed time we took a closer look at the concept…

In its simplest form, the Tragedy of the Commons argument seems almost self-evident. If we completely use up a resource, common or otherwise, we will not be able to use it in the future. If other groups are also dependent on that resource, then consuming it to the point of destruction will harm not only our future prospects but those of everyone else in the community or industry. Unfortunately, things in an interconnected global marketplace are rarely that simple anymore, and we have begun to encounter versions of the problem where millions or tens of millions of users are attempting to make maximum use of a shared resource. To take a familiar example, if one tourist removes one ounce of rock from Yosemite National Park, this would be trivial, but if each of the four million people who visit the park each year were to remove one ounce each, that would be 250,000 pounds or 125 tons. And since the vast majority of the visitors stay in Yosemite Valley, that would mean 125 tons of rock per year being removed from an area less than seven miles square…

We could also consider examples where failure to take action by large numbers of people can have massive cumulative effects, such as the case of when during a closely-contested election individual voters decide to write in a candidate, or vote for a third-party candidate without any broad public support. Each of those individual voters may believe that his or her specific vote will not make any difference in an election where tens of millions of people will be casting ballots, and to some extent this might be true, but when thousands or millions of people all take up such a belief, the cumulative effect frequently does change the outcome – and sometimes the course of history…

The real problem, at least from a business standpoint, is that it isn’t always clear when a given resource is going to be exhausted, or even how many other firms are depending on it. And, as managers, we have a fiduciary responsibility to our shareholders and a moral responsibility to our employees and the other stakeholders to maintain a profitable company. Of course we’re not going to intentionally wipe out a non-renewable resource just to gain a momentary advantage, but bankrupting the company and all of the people who depend on it in order to meet a conservation goal that may or may not even be necessary does not make sense either.

All of which leads me to the question: At what point does our potential responsibility to our industry, our society, our species, or our planet supersede our responsibility to our employers, whoever and whatever they happen to be? Clearly, we cannot in reason expect to behave as if ours was the only company in the world, just as we would never behave as if we were the only people in the world. But at what point does the risk of destroying something much larger than ourselves override the need to do our jobs?

It’s worth thinking about…