Collective action arises when the efforts of two or more individuals are needed to achieve an outcome. From the time when humans first walked upright, individuals have relied on the actions of the group for defense, fuel, food (for example, hunting large animals), reconnaissance, charity, and safety. By its nature, collective action involves interdependency among individuals in which the contributions or efforts of one individual influence the actions of other individuals, thus implying a strategic interaction. As society becomes more complex, the need for collective action grows. Globalization has taken this need to new heights. Even the existence of well-functioning markets depends on collective action in the form of contract and regulatory law, standards of weights and measures, a justice system, police, and infrastructure(for example, transportation and communication networks) that provide for the unfettered exchange of property rights.

Collective action is partly associated with the provision of pure public goods whose benefits are nonrival and nonexcludable. Benefits are nonrival when a unit of the good can be consumed by one individual without detracting, in the slightest, from the consumption opportunities still available for others from the same unit. Like magic, a nonrival good can be used by more and more people without a noticeable degradation in quality or quantity. Reducing air pollution gives a nonrival benefit, since my breathing the cleaner air does not reduce the benefits of the improved air quality available for others. Similarly, uncovering the cure for a disease helps everyone – an application of the cure to one person does not limit the cure's application to others.