Common Resource

Updated Dec 31, 2022

Definition of Common Resource

A common resource is defined as a good that is rival, but not excludable. That means it is shared by a group of people or a community (i.e., access cannot be restricted or limited), but not available to all of them at the same time (i.e., if one person consumes it, another person cannot do so at the same time). Common resources can be either renewable or non-renewable, and they can be either natural or man-made.

Example

To illustrate this, let’s look at an example of a natural common resource: water. As we all know, water is essential for life, and it is shared by all living creatures on Earth. That means it is available to everyone, regardless of their economic or social status. Or in other words, it is not excludable.

However, although water is a renewable resource, if one person drinks a glass, that same glass can obviously not be consumed by someone else (i.e., it is rival). As a result, we can experience shortages if too many people or companies use too much water in certain areas at certain times.

Why Common Resources Matter

Common resources are essential for the survival and prosperity of any society. They provide the basic necessities of life, such as food and water. In addition, they can also be used to create economic opportunities and foster innovation. That means they are essential for the development of any society.

However, common resources can also be mismanaged and overused. That is why it is important to ensure that they are managed responsibly and sustainably. This can be done by setting up regulations and policies that ensure their equitable use. In addition, it is important to educate people about the importance of common resources and the need to use them responsibly.