Chapter 62 Chapter 5 The Arms Race and the Tragedy of the Commons

Why Do Doctors Tend to Prescribe Overdose of Antibiotics? Why are women willing to put up with the discomfort of high heels? Why are many supermarkets open 24 hours? Why are retailers putting out Christmas decorations in September? Why are the cherries growing on the trees in the park eaten up early? Why does splitting the bill evenly make people spend more in restaurants? Why is there a traffic accident on the independent northbound lane of the expressway, but it causes traffic jams in the southbound lane? Why do ice hockey players vote unanimously for a helmet-wearing rule, but when left to make their own decisions, almost none of them want to wear a helmet?

Why do many schools require students to wear school uniforms? Why do bureaucrats like to use vague sentences? Adam.Smith's invisible hand is one of the most famous concepts in economics.Smith was the first to see clearly that the pursuit of self-interest in the marketplace often benefits all.For example, when a producer adopts a cost-saving innovation in the hope of higher profits, but as competing firms follow suit, the price of the product falls, ultimately benefiting the consumer. Unlike many economists today who praise the invisible hand, Smith never entertained the illusion that unbridled competition would always benefit all.In "The Wealth of Nations", he made a very restrained statement on the results of the business owner's pursuit of personal interests: the pursuit of personal interests often enables him to promote more effectively than he really intends to promote the interests of society.

The person who believes that there is a profound contradiction between individual interests and collective interests is Darwin, the father of evolution theory, and Thomas Smith, who was deeply influenced by Smith's works.Malthus (Thomas Malthus) and some other economists.Darwin's central thesis was that natural selection favors traits and behaviors that favor reproductive success in individuals.Whether these traits and behaviors are beneficial to the species as a whole is out of consideration.Some traits, such as intelligence, are not only conducive to the successful reproduction of an individual, but also to the benefit of the species as a whole.Others, which are in the interest of an individual, are only detrimental to the species as a whole.The huge horns of the male elk clearly illustrate the latter case.

Like male walruses and males in most other polygamous species, male elk fight each other for access to females.Their horns are the main weapon in battle, and male elk with larger horns are more likely to win their opponents.So, bucks with bigger horns got more mates, so in the next generation, their big horn genes showed up more often.In this way, horns become the focus of an evolutionary arms race. While large horns help win over females, wolves and other predators can make it difficult to flee in dense woods.So, logically speaking, it would be best to halve the size of each elk's horns.After all, in internal battles, the relative size of the horns matters.If all male elk had smaller antlers, they would still fight each other as well as before, while increasing their chances of escaping predators.

But natural selection, the source of the problem, does not provide a solution.It is true that the mutant elk with smaller antlers can escape relatively safely from predators.But it has no access to female elk.So, a copy of its gene will not appear in the next generation which is the only determining factor in the framework of Darwin's theory of evolution. Oversized horns belong to a characteristic that can be called a good thing for individuals but useless for groups.The cost-benefit principle holds that individuals will take action when the personal benefits outweigh the personal costs.If the individual decision maker obtains all the benefits related to the action, he also bears all the related costs, Adam.Then came the invisible hand of Smith to do its work.But there are many individual actions that will benefit others or cause others to bear the cost.

For example, if someone in the audience stands up to get a better view, it will inevitably block the view of the audience behind them.Likewise, if additional fishing boats go out, it will reduce the catch of existing fishing boats.In this case, the invisible hand seems to lose its usefulness.In order to see better, everyone stood up, and it turned out that no one could see better than when everyone was sitting. As long as the expected net income can exceed the opportunity cost of the time spent and other expenses, fishermen will go to sea to fish, and the result will inevitably lead to overfishing and the tragedy of public goods. (The tragedy of public goods, the public things that belong to the most people are often the things that are least cared for by people. People care about what they have, while ignoring the public things. Editor's note)

In this chapter, we look at the divergence between individual and social interests to help us solve a series of puzzles.