3 Common Goods

Suppose you are one of two goat farmers in a village. You may each use the village commons for your goats to graze without enforced restriction.

One day, you meet with the other farmer to discuss use of the village commons. You each know that the most total lifetime profit from goats will come when the field supports exactly 12 goats in total. So, the other farmer suggests that you each raise 6 goats and get half of the total lifetime goat profit.

But, you also know that your individual lifetime profit from goat production is as follows:

But, you also know that your individual lifetime profit from goat production is as follows: II1 (30 - q1 - 92) .91 - .q1, Your profit Goat price given total goat production Cost of raising a goat where q1 represents goats you raise and q2 represents goats raised by your rival goat farmer