An economic problem in which every individual tries to reap the greatest benefit from a given resource. As the demand for the resource overwhelms the supply, every individual who consumes an additional unit directly harms others who can no longer enjoy the benefits. Generally, the resource of interest is easily available to all individuals.

Investopedia Says:
The tragedy of the commons occurs when individuals neglect the well-being of society (or the group) in the pursuit of personal gain. For example, if neighboring farmers increase the number of their own sheep living on a common block of land, eventually the land will become depleted and not be able to support the sheep, which is detrimental to all.

Related Links:
Find out how your mindset can play a larger role in your success than market influences. Trading Psychology And Discipline
If these unpleasant emotions are allowed to influence your decision-making, they may cost you dearly. The Financial Markets: When Fear And Greed Take Over
Find out how these Wall Street high-rollers landed themselves in hot water. 4 History-Making Wall Street Crooks
Wall Street continues to attract fresh hordes of ghoulish people committing the same old crimes. Tales From Wall Street's Crypt
If you're new to the stock market and want the basics, this is the tutorial for you! Stocks Basics: The Bulls, The Bears And The Farm
To take advantage of all your investing options, you need to know what your choices are. Here we tell you about the diverse features and advantages of 20 different financial instruments. 20 Investments: Conclusion

Copyright ©2010, Investopedia.com - Owned and Operated by Investopedia US, A Division of ValueClick, Inc. All rights reserved.