Class Notes (807,354)
Canada (492,719)
Economics (219)
ECON 1010 (102)
Lecture 69

ECON 1010 Lecture 69: Lecture 69

3 Pages
Unlock Document

University of Manitoba
ECON 1010
Laura K.Brown

o982 What Causes the Tragedy?: 1. Social and private incentives differ 1. No single family has an incentive to reduce the size of its flock because it represents only a small part of the problem 2. The tragedy of the commons arises because of an externality 1. Allowing one’s flock to graze on the common land reduces its quality for other families o People neglect this external cost, resulting in overuse of the land What could the government or townspeople have done to prevent the tragedy?: 1. Regulate the number of sheep per family 1. “Internalize the externality” by: o Taxing sheep o Auctioning off a limited number of sheep-grazing permits 2. Divide the land, sell lots to individual families - the land becomes a “private good” They fixed the problem by: 3. Divide the land, sell lots to individual families - the land becomes a “private good” 4. Solved the problem by internalizing the externality
More Less

Related notes for ECON 1010

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.