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Common resource

Definition

A common resource refers to a type of resource that is non-excludable but rivalrous. This means that while anyone can access and use the resource, one person's use or consumption reduces the availability of it for others.

Analogy

Imagine a pizza buffet where anyone can grab a slice without any restrictions. However, as more people take slices, there are fewer left for others to enjoy.

Related terms

Public good: A public good is similar to a common resource in terms of being non-excludable, but it is non-rivalrous, meaning one person's use does not diminish its availability for others.

Private good: In contrast to a common resource, a private good is both excludable and rivalrous. It can only be consumed by those who pay for or own it, and consumption by one person prevents others from using it.

Club good: A club good is excludable like a private good, but it is non-rivalrous like a public good. While access may be restricted to certain individuals or groups, consumption by one person does not reduce its availability for others within the group.