There are several countries which border the Mediterranean Sea. These countries all share, in the common social good of the resources provided by their location, on the shoreline of the Mediterranean Sea. They also share the external social costs associated with using the resources available from the Mediterranean Sea. Common goods are defined as those goods which are available to everyone for consumption whether the individual pays the cost of the good or does not pay for its consumption (Olson, n.d., p. 15). No one can be excluded from consuming the good if anyone does. The air we breath, the military, police forces which governments maintain, beautiful views of the ocean or mountains. Some public goods have no cost associated with them; a view of the mountains has no direct costs of viewing it. Other public goods have a cost associated with their production, or with consuming them. These are goods such as the military, the police forces, and utilizing natural resources. Polluting a natural resource may not have a direct cost on the producer of the good or service but still incurs a social cost to others, living or working, around the producer. This is the case with regard to dumping in the Mediterranean Sea.
Dumping in the Mediterranean Sea has an external social cost which affects the whole region. Dumping, in the Mediterranean Sea, depressing the fishing and tourist industries in all the countries along the coastline. Dumping likely affects the health of the people, in the region, where the dumping is occurring. External social costs of production are difficult to control for many reasons. The unavailability of a single organization in control which could enforce a standard acceptable level of pollution, the transaction costs associated with the formation of a treaty to clean up the Mediterranean Sea, and the free rider problem.
In cases where the social cost is spread over many countries, they are almost im...