The Tragedy of the Commons Will Be Evident When a Growing

question 253

Multiple Choice

The Tragedy of the Commons will be evident when a growing number of sheep grazing on the town commons leads to a destruction of the grazing resource.To correct for this problem,the town could

• A) allow individual shepherds to chose their own flock sizes.
• B) internalize the externality by subsidizing the production of sheep's wool.
• C) auction off a limited number of sheep-grazing permits.
• D) wait until the market corrects the problem.