With all due respect I disagree, this isnt a Tragedy of the Commons scenario. In a Tragedy of the Commons scenario the main reason it happens is because actors aren't incentivized against using a public good. Steemit has many incentives put specifically in place to sway people from selling and holding instead long term. The incentives put forth by steemit to obtain more profit by holding long term is the sole reason this becomes a game theory problem.
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The incentives for holding long-term decrease if the price has a long-term downward trend. That said, I really don't believe many people powering down, whale or not, is a problem. The "money" produced often stays in the ecosystem. It creates trading opportunities on the internal market.
I agree with you that the incentives for holding long term decrease if the price has a long term down trend, but currently between the interest rates earned on steem power, the ability to earn large amounts from curation rewards and having the power to influence what content gets seen, the incentives far outweigh the benefits of powering down and selling all of it. This can change over time as the interest rate returns fall and inflation stays high, but im hoping by that time (roughly 9 months) we will have a much more established ecosystem. I think many people forget that many of the whales bought in at such low points that their opportunity costs to sell are extremely low as well. The market has to correct on the price, its just how it works. I said at $3 I wouldnt be surprised if the price fell back to $1 and im still holding that state of mind. The market has to get to a point of equilibrium where speculators and incoming users are comfortable with buying steem and getting involved in the system.
If it's not Tragedy of the Commons then it certainly has potential to be some form of the Prisoners Dilemma.
👍nice post, nice theory @calaber24p
Tragedy of the Commons doesn't apply only to "public" goods but to shared resources. Liquidity in the trading books is a shared resource. If you prefer, you can also see it as a prisoner dilemma: if not all the whales stop cashing out, the ones who keep doing so are the ones who keep damaging the price but get the benefit of cashing out earlier. This creates a positive incentive for being selfish.
I was just using public good as a way to say that it was open to many participants, when I think the whale situation should be more studied as more of an oligopoly. I like the prisoner dilemma approach better. However I see it just as another possibility to what CAN happen. There are many possible outcomes in economics and I think that both are equally as likely. It depends on what kind of people the actors are.