Interesting question. Are you referring specifically to the tragedy of the commons? In the tragedy of the commons, the entire group is best off if everyone cooperates, but each individual in the group has an incentive not to cooperate, so everyone is worse off than they could be.
One example that comes to mind is women wearing makeup. I truly believe everyone would be better off if women didn’t wear makeup. Less time and money spent; less natural resources consumed. However, if nobody wore makeup, then one person would be tempted to wear makeup to get an advantage over everyone else. Therefore, everyone wears makeup. (A simplistic example, I know; I myself wear makeup only on special occasions. But it’s an example.)
Another example: a state government deciding whether or not to ban or allow toxic air pollution from a manufacturing plant. If they ban it, everyone in the state and surrounding states (arguably, the world) is better off. If they allow it, the economy of their state benefits. If everyone banned polluting manufacturing plants, everyone would be better off… but if one state allows pollutive facilities and everyone else bans them, that state would draw all the pollutive manufacturers and the economic benefit that comes from them. Nobody wants to be the first one to block out those manufacturers, so no state bans pollutive facilities. (This explains why pollution regulation is often at the federal level.)