The Tragedy of the Commune: Learning from worst-case scenarios

Living in an apartment- or house-sharing community may offer numerous advantages. Unfortunately, under certain circumstances this easy, adventurous, harmonious life in such a communal arrangement may turn into a Hobbesian “war of everyone against everyone.” Applying some well-known instruments from the economic toolbox, this paper demonstrates why flat sharers’ individually rational behavior may lead to collectively undesirable outcomes. It also offers some practical remedies. Tragically, even if housemates realize that they are on the road to ruin, without concerted action, which poses a collective good problem, their livable commune gradually turns into an inhospitable environment.