Principles of Microeconomics / Unit 12 MIC 1112 short lesson, about 20 seconds
The Free-Rider Problem
Captions available
The idea
If nobody can be kept out, nobody has to pay. Each lets the others pay and rides free; if all reason that way, the good is never built, though all would gain.
In practice
A firm billing each household for defense collects from almost none.
Where people slip
Free riding is not dishonesty; it is the best reply to a good that arrives unpaid.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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