Free Rider Problem
In economics, collective bargaining, psychology and political science, "free riders" are those who consume more than their fair share of a resource, or shoulder less than a fair share of the costs of its production. Free riding is usually considered to be an economic "problem" only 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 free rider problem is the question of how to prevent free riding from taking place (or at least limit its negative effects) in these situations.
In the context of labor unions, a free rider is an employee who pays no union dues or agency shop fees, but nonetheless receives the same benefits of union representation as dues-payers. Under U.S. law, unions owe a duty of fair representation to all workers that they represent, regardless of whether they pay dues. Some jurists have questioned the fairness, if not the legality, of this practice.
Free riding is also a term used by brokerages when a client purchases shares beyond his or her means. Free riders are those who purchase shares and then do not pay for them. (See margin.)
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Famous quotes containing the words free, rider and/or problem:
“Freedom of enterprise was from the beginning not altogether a blessing. As the liberty to work or to starve, it spelled toil, insecurity, and fear for the vast majority of the population. If the individual were no longer compelled to prove himself on the market, as a free economic subject, the disappearance of this freedom would be one of the greatest achievements of civilization.”
—Herbert Marcuse (1898–1979)
“Came to Ajanta cave, the painted space of the breast,
the real world where everything is complete,
there are no shadows, the forms of incompleteness,
The great cloak blows in the light, rider and horse arrive,
the shoulders turn and every gift is made.”
—Muriel Rukeyser (1913–1980)
“The general public is easy. You don’t have to answer to anyone; and as long as you follow the rules of your profession, you needn’t worry about the consequences. But the problem with the powerful and rich is that when they are sick, they really want their doctors to cure them.”
—Molière [Jean Baptiste Poquelin] (1622–1673)