Tragedy of the Cupcakes: Economics Mt. Holyoke Style

Tragedy of the Cupcakes: Economics Mt. Holyoke Style

By Lina, Olivia, Yang, and Xinyang

It was a normal Wednesday evening at Mt. Holyoke College as Suzie finished the first sentence of her five-page paper due tomorrow. “Woo! Great start. I’m really on a roll now!” she thought as she hit the space bar twice, ready to start the next sentence. 

She made the mistake of looking at the clock: 9:35 P.M.  “Nuts! M&C’s!” Suzie thought as she sprang from her desk without even saving her stellar paper. 

She grabbed her tacky souvenir mug and ran down the stairs to her dorm’s dining hall. 

As she sprinted toward the kitchen, she noticed people walking out with fistfuls of cupcakes: chocolate and vanilla.  Every person she passed was gripping at least three cupcakes.  Suzie knew this was a bad sign.  As she rounded the bend into the kitchen, her heart sank.  She stood there and took in the tragic sight: an empty tray under a few crumbs.  This was all that remained of the delicious treat that was there only five minutes before. Of course, Suzie was on time to M&C’s last night and was promptly served carrots and raisins.

She was shocked by the injustice of it all: some girls were happily munching away on three cupcakes at a time while Suzie was left with crumbs.

However, perhaps if she were an econ major, Suzie would not be so shocked.  Simple economics can explain the sad sight Suzie witnessed.  Economists call it the “tragedy of the commons.”  This phenomenon is explained by an analogy of a field shared by farmers.  The farmers allow each of their livestock to graze on the field endlessly.  Eventually the field is overgrazed and there is no more grass left for the animals to eat.  In this analogy, the tray of cupcakes is the field of grass and the hungry Mt. Holyoke students are the grazing cows… 

Let me try another explanation in case you didn’t like that one.  This M&C’s tragedy is explained by the fact that M&C’s (or the food put out at M&C’s) is what economists call a common good.  This means the cupcakes are rival, non-excludable goods.

Rival goods are goods for which one woman’s consumption of the good diminishes another’s ability to consume the good.  For example, if Nancy devours a chocolate cupcake, Suzie can’t eat that same cupcake. 

These M&C’s cupcakes are also non-excludable.  Excludability is determined by whether or not a person can be prevented from consuming the good.  For example, price can be an excluding factor.  Chocolate cupcakes sold in bakeries are excludable goods because they cost money.  Goods that cost money are always excludable goods because there will always be consumers who are unwilling or unable to purchase the good.  M&C’s are provided to students (and any other random townies who manage to wander in between 9:30 and 10 P.M.) for free and there are no staff members to enforce rules (for example, one cupcake per person). 

Suzie’s tragic discovery can be explained by simple economics and the fact that M&C’s presents Mt. Holyoke with a common good.  Unfortunately since the snacks at M&C’s are rival but non-excludable, they are considered common goods.  This sets students up for a nightly “tragedy of the commons” in their own dining halls…except, of course, on the nights they’re served carrot sticks and raisins.