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1.) This first dance is an experiment that demonstrates an economic principle called the tragedy of the commons. Participating in this experiment are five volunteers who are seated at the computers at the front of the room. The volunteers know nothing about the experiment. Everything I am telling you; they are hearing for the first time also. The tragedy of the commons is an economic principle that tells us how humans behave in the presence of a renewable resource. In this experiment the renewable resource is light. Each volunteer controls one light that illuminates one of our five dancers. The colors on their computer screens match the colors of the lights on the stage so you can tell who is controlling which light. Volunteers- when you click your mouse your light turns on and the audience can see your dancer. When you click the mouse again, you turn your light off leaving your dancer to dance in the dark. You may turn your light on and off as many times as you like. Your goal is to keep your dancer lit for as much of the dance as possible. Here's the catch- and this is where the renewable resource comes in- up here you will see a renewable bank of light, you will have 30 seconds worth of light. When one of you turn your light on you draw down from this bank. When you turn your light off, the bank gradually replenishes. For each second your light is on, you take 1 second away from the communal bank. If the bank falls to zero all of your lights automatically turn off. With the lights off, the bank starts to replenish and then you will be able to turn your lights on again. The dance runs for 2 minutes. The timer is shown here. The buttons you see here will turn green and red indicating whether your light is on or off. Finally, this bar graph is for the audience use. As the dance progresses, bars will rise here showing how much time each one of you has used in your dance. Finally, this is the total time your five lights are on for the entire dance. Remember only one thing matters, keep your dancer lit for as much of the dance as you can. To help reinforce this, the two of you who keep the lights on the longest will receive a monetary prize. Wait for the music to begin to turn your lights on. When the music stops, stop clicking and remove your hands from the mouse.  

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2.) In this first movement our volunteers generated a total of 5 minutes of 45 seconds of light. Volunteers 2 and 4 generated the most light so you win the prizes. In this second movement we will repeat the experiment everything will be the same as in the first movement with one exception. We will divide the bank of 30 seconds into 5 separate banks of 6 seconds each. Volunteers -in this second movement when your light is on the time comes out of your private bank. When the light is off, your private bank replenishes. You cannot use time from anyone else’s bank, and no one will use time from your bank. Your private bank times will be shown here on the right next to the on/off lights. Again, only one thing matters, keep your dancer lit as much of the dance as you can. Wait until the music starts to turn your lights on. When the music ends. Stop clicking and remove your hand from your mouse.

3.) Recall that in the first movement, our volunteers generated a total 5 minutes and 45 seconds of light. In the second movement, they generated 6 minuets and 44 seconds of light. The two movements were identical except in the first movement the light was commonly owned. In other words, no one person owned the lights. In the second movement, the light was privately owned. Each one of our volunteers owned a specific portion of the light. Herein lies the economic principle of the tragedy of the commons. When no one owns a resource people have an incentive to use the resource because the resource is valuable, but no one has incentive to conserve the resource because all that will happen is that someone else will come along to use what you conserved. But when the same resource is privately owned and property rights to that resource are well defined and protected, people have not only an incentive to use the resource but also an incentive to conserve the resource. The incentive to conserve it comes from the fact that the property rights ensure that whatever resources you conserve today will be available for you to use in the future. More importantly, when the recourse is privately owned, we get the right amount of conservation. Because it is possible to have too much conservation. Imagine if our volunteers had conserved all of their light, we would have ended with a huge bank of light built up but we would have been unable to see the dance.  The tragedy of the commons plays out among us all the time. Water pollution occurs when it’s unclear who owns the water. Deforestation occurs when it’s unclear who owns the trees. Overfishing occurs when no one knows who owns the fish. And here, we are less able to enjoy our dancers when it’s unclear who owns the light.