Free Rider Problem

In the analyses of economics and political science, free riders are actors who take more than their fair share of the benefits or do not shoulder their fair share of the costs of their use of a resource, involvement in a project, etc.. The free rider problem is the question of how to prevent free riding from taking place, or at least limit its effects. Because the notion of "fairness" is highly subjective, free riding is usually only considered to be an economic "problem" when it leads to the non-production or under-production of a public good, and thus to Pareto inefficiency, or when it leads to the excessive use of a common property resource. The usual example of a free rider problem is National Defense: no person can be excluded from being defended by a nation's military and thus free riders may develop who refuse or avoid paying for being defended, but are still as well guarded as everyone else in the nation. Therefore, it is usual for the government to avoid relying on volunteer donations, using taxes and/or conscription instead. The problem is particularly important and troublesome when considering goods or resources to which access cannot be excluded. For more information, see public good and tragedy of the commons. See also TANSTAAFL and Malibu surfer problem.

References

  1. Richard Cornes and Todd Sandler, The Theory of Externalities, Public Goods and Club Goods 2nd ed. (1996)

With regard to a literal free ride, see also Conductor (transportation), Stowaway.

 

<< PreviousWord BrowserNext >>
slater
1230s bc
720s bc
10 bc
11 bc
13 bc
grook
1280s bc
730s bc
prawn
740s bc
1290s bc
1300s bc
750s bc
760s bc
770s bc
780s bc
790s bc
800s bc
20th century bc
perfect square
jean racine
magic square
nanowire
super ellipse
original dixieland jass band
corporate welfare
kingdom of asturias
the diamond age
trade dress
sourceforge
zeeland
osaka, osaka
mauritshuis
cliff richards
chief executive officer
hoax
autosport
touring car racing
sports car racing
rally racing
alfred jodl
continuous fourier transform
gujarati script