Question

5. Common resources versus private goods Spring is here, and Ginny and her uncle would like to go fishing for the weekend in New Hampshire. Ginny could either go to the river in town where anyone can fish without a permit, or she could drive up to a stream located on her family's property in the countryside to fish. Assume that, no matter where people fish, all of the fish that are caught would be kept (that is, there is no "catch and release" policy). The fish in the river are considered and whereas the fish in the private stream are and . In other words, the fish in the river are an example of , and the fish in the private stream are an example of . Fishing in the river will likely lead to because of which of the following reasons? All fishermen will choose to fish in the river because of the limited access to the stream. Anyone can fish in the river, and one person's fishing activity decreases the ability of someone else to fish with success. Nobody will enjoy fishing because of the lack of private contributions to the maintenance of the river. All fishermen will choose to fish in the stream believing that there are more fish there. Grade It Now Save & Continue Continue without saving

Answer 1

Answer:

1. Fish in private stream (rival/Excludable). Fish in River (rival/non Excludable)

2. Fish in Private stream (private good). Fish in River (common resource)

3. Tragedy of commons

Explanation:

1. The fish in the private stream are Rival in consumption and Excludable while the fish in the river are Rival in consumption and Non- Excludable

2. The fish in the private stream is a private good, the fish in the river is a common resource.

A private good must be purchased to be consumed. Consumption by one person prevents another person from consuming it hence it is rival and Excludable. A common resource like the river benefits all individuals because it is not owned by any one individual. A common resource stands the risk of depletion and over consumption.

3. Fishing in the river will lead to tragedy of the commons because anyone can fish in the river, and one person's fishing activity decreases the ability of someone else to fish with success.