01 February 2011

The commons problem

The tragedy of the commons is the real economy analogue to the money economy's paradox of composition. 
The tragedy of the commons comes from hoarding the extractive resources rather than renewing their fertility; the paradox of composition comes from hoarding the money rather than circulating it. 
The commons problem comes from failing to establish clear property rights to the resources' fertility; the composition problem comes from risk of default. 

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