Abstract: The theory of law and economicsholds that institutions are the key point for the resources utilization.Therefore,the game analysis of “Tragedy of the Commons” should not ignore the function institutions play.It is a misguiding that the traditional game theory regards “Tragedy of the Commons” as “Prisoner’s Dilemma”.The game of “Prisoner’s Dilemma” is consequence of special institutions arrangement.In this circumstance,the players can not have cooperation because the information exchange has been strictly prohibited and the institutions have special prefer.On the contrary,the players can share information freely and eventually reach consensus about governing the commons effectively in “Tragedy of the Commons”.Thus,“Guaranty Game”,not “Prisoner’s Dilemma”,is proper model to describe “Tragedy of the Commons”.

Key words: law and economics, Tragedy of the Commons, Prisoner&rsquo, s Dilemma, guaranty game