`Is there any relationship between the prisoners` dilemma and provision of public goods` and `How can the collective action problem be overcome?` Discuss

SOLUTIONS TO OVERCOME COLLECTIVE ACTION PROBLEM

By Collective action we mean to follow the goal or set of goals by more than one person , together to attain the fruitful gains . It means following those set of standards of social integration as well as those factors that leads to the attainment of maximum benefit from the combined action of group , whether it is social , economical , political or any other field . It means in pursuit of shared Interest (Marshal 1998 , framing rules for profitable utilization of resources , and voluntary methods . In the Social arena

, its theories emphasized how can Collective Action be linked to social institutions for performing welfare activities , whereas economically it is concerned with the provision of public goods , other collective consumptions through the collaboration of two or more individuals , and the impact of external forces on group behavior

The capacity to perform the tasks that affect the whole community or group is a most important function of collective action . This involves Management of natural resources , providing facilities for joint Investment by small farmers , dissemination of technologies , Marketing group empowerment , many other development policies etc . If group of people have a common interest then they 'll naturally get together and fight for the common goal , but according to Olson "But it is not in fact true that the idea that groups will act in their self-interest follows logically from the premise of rational and self-interested behavior . It does not follow , because all of the individuals in a group would gain if they achieved their group objective , that they would act to achieve that objective , even if they were all rational and self-interested . Indeed unless the number of individuals in a group is quite small , or unless there is coercion or some other special device to make individuals act in their common interest , rational , self-interested individuals will not act to achieve their common or group interests ( Moffet Mike , Special Interests and Economic Policy

This means in the Collective Action it is not necessary that all would gain and achieve their group objective . There are self interested Individuals too in groups that goes contrary to the Interest of the group . For e .g . In Perfect Competition Market whereby there are very large number of producers of an identical good . In this condition , all firms will end up charging the same price , a price that leads to a zero economic profit . If the firms decides to cut their output and charge a price higher than the one that prevails under perfect competition all firms would make a profit . But according to Olson , this does not happen since there is a uniform price in a market , therefore a firm cannot get a higher price unless all the other firms in the industry have this higher price . But here a firm has self-interest , it wants to sell as much as it can , until its cost of producing another unit exceeds the price of that unit . Therefore here each individual 's firm 's interest is different...