What Is Public Good Game Theory?


Diego Sanchez

Public Good Game Theory: Understanding the Concept

Public good game theory is a concept that has been extensively studied in economics and political science. It refers to a scenario where individuals have to make choices that affect the well-being of the entire group. These choices can be either cooperative or non-cooperative, and they can have significant implications for the overall welfare of society.

The Basic Idea of Public Good Game Theory

Public good game theory is based on the idea that certain goods or services are beneficial to everyone in society, regardless of whether they contribute to their provision or not. Examples of these public goods include things like clean air, national defense, and public parks.

The problem with public goods is that they are often under-provided by the private sector because there is no direct financial incentive for individuals or companies to invest in them. This leads to a situation where everyone benefits from the public good, but no one wants to pay for it.

The Tragedy of the Commons

The tragedy of the commons is a classic example of public good game theory. It describes a scenario where multiple individuals have access to a shared resource, such as a pasture. Each person can choose how many animals they want to graze on this land, but if everyone takes too much, there will be overgrazing and depletion of resources.

In this situation, each individual faces a trade-off between their own self-interest and the interest of the group as a whole. If everyone acts in their own self-interest and takes as much as possible from the common resource, it will eventually be destroyed.

Cooperative vs Non-Cooperative Strategies

In public good game theory, there are two main types of strategies that individuals can use: cooperative and non-cooperative.

Cooperative strategies involve individuals working together for the common good. This could involve contributing money towards a public service or volunteering time towards a community project. Cooperative strategies are beneficial for everyone involved because they lead to a higher level of provision of the public good.

Non-cooperative strategies, on the other hand, involve individuals pursuing their own interests at the expense of others. This could involve taking more than their fair share of a public resource or refusing to contribute towards its provision. Non-cooperative strategies can lead to a situation where everyone ends up worse off.

The Free-Rider Problem

One of the biggest challenges in public good game theory is the free-rider problem. This occurs when individuals benefit from a public good without contributing towards its provision.

For example, imagine that a group of neighbors decides to hire someone to clean up their local park. If one person decides not to contribute any money towards this project, they will still benefit from the cleaner and safer park. However, if everyone takes this approach, no one will contribute any money and the park will remain dirty and dangerous.

Solutions to Public Good Game Theory

There are several solutions to the problem of public good game theory. One approach is to use government intervention to provide public goods that would otherwise be under-provided by the private sector. Another approach is to use social norms and peer pressure to encourage people to act cooperatively.

In some cases, it may also be possible to create incentives for individuals or companies to invest in public goods. For example, tax credits could be offered for those who donate money towards environmental conservation efforts.


Public good game theory is an important concept that has significant implications for our society. It highlights the importance of cooperation and collective action in ensuring that we have access to essential services and resources.

While there are challenges associated with providing public goods, there are also solutions available that can help us overcome these obstacles. By working together and recognizing our shared interests, we can create a better future for ourselves and future generations.