What is the Logic of Collective Action?

The Logic of Collective Action is a 1965 book on social and political theory by American economist Mancur Olsen, Jr. In this landmark volume, Olsen attacked the prevailing concept that groups of humans are prone to act for the public good. Olsen suggested that the larger a group is, the less likely it will be to collectively act for the common good for a variety of reasons. The Logic of Collective Action remains an important tome of social philosophy in the 21st century.

According the wisdom of the time, rational individuals that belong to a group should choose to act in the best interest of that group. This theory was propounded by many prominent philosophers, possibly the best known of which being Karl Marx. Olsen disagreed with this popular sentiment quite strongly, believing that the complexities of group dynamics fundamentally weakened the likelihood of action for the benefit of all. At a point of critical mass, Olsen argues, the balance will tip in favor of self-interested actions, regardless of similar common goals.

The basic theory propounded in The Logic of Collective Action broke down human groups into three major categories, called privileged, latent, and intermediate. Latent groups are those in which an individual member could avoid contributing without a noticeable drop to the public benefit. An example of a latent group might be the voting population of a country, where a single individual's choice to vote or not vote might not cause a notable impact in the outcome of an election. Privileged groups, by contrast, are those where every member stands to gain more from the public benefit sought than he or she could on his own. In a privileged group, the book suggests that the public benefit will be more likely to be achieved, while in the latent group, it is less likely to be achieved.

The Logic of Collective Action also discusses the important of group size in diluting the chances of participation in public good. Since resources like money, time, and manpower are generally finite, the reach of a public program is likewise finite. Thus, the larger the group, the more diluted the benefits become, resulting in increasingly lower returns for individual investment. Once it becomes clear that an individual could generate greater personal returns by acting in self interest, Olsen suggests that the chances of choosing to act in group interest will drop significantly.

The main strategy suggested by The Logic of Collective Action requires that groups be limited by size and motivated by selective incentives. Keeping groups small helps reduce the dilution effect that promotes self-motivated action, while providing social incentives might encourage members of a latent group to participate regardless of the impact created by their actions. Olsen continued to develop and refine his theories throughout his long and productive career, providing further analysis and study in The Rise and Decline of Nations and Power and Prosperity.