Hardin's Tragedy of the Commons provides the most accessible representation of environmental problems and, hence, environmental degradation.
It states that agents using an open access resource* (i.e. resources that are accessible to anyone, with no restriction on use) do not bear the full cost of their use but do receive all their benefits. Therefore, private incentives exist that lead to over-exploitation and resource depletion.
Hardin's example considers the case of shepherds grazing cows on a common ground, each wanting to have a greater number of cows in the field. When deciding whether this is beneficial each individual will outweigh benefits vs. costs. The problem arises due to the fact that the shepherd receives all the benefits of grazing another cow (e.g. selling the "extra" cow provides him with further income) but does not incur in the true overall costs (e.g. risk of disease, overgrazing, etc.) as they are shared among all shepherds. Consequently, after comparing total benefits vs. partial costs, the shepherd will always choose to add another animal, eventually causing overuse.
In other words, if something belongs to everyone, no one will care for it.
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Solutions to this problem will be considered in further posts but can generally be divided into market incentives and/or regulatory approaches.
*E.g.: such as fisheries, road networks, bodies of water, etc.
