<p>The existing answers are covering mostly only situations where the 'free riders' aren't using up anything. It's important to note that an emergency room is <em>absolutely not</em> such an example. Someone who is not paying for an emergency room visit <em>is</em> using up someone else's resources without compensating them. They are taking up an ER room that could be used by other patients, taking up time of the doctors, nurses, and other staff, and using up consumable goods such as medications, gloves, needles, etc. All of this costs money.</p>

<p>As a result of the free rider, everyone else is paying more, receiving worse service, or both compared to what they would have if the 'free rider' either paid their share or weren't present.</p>

CC BY-SA 4.0
2018-07-31T18:16:26.553Z
2018-07-31T18:16:26.553Z
reirab
<p>There are other aspects, which (I think) has not been mentioned by other answers.</p>

<p>If people have the choice to pay for something, or to be a free rider, almost everyone will choose to be a free rider. If everyone pays their fair share (for some definition of "fair share") of the cost of road building &amp; maintenance, and the roads get built, then everyone benefits.</p>

<p>If Dave is the a free rider, the roads will still get built. In a country with a population of millions of people, everyone else will only need to pay a fraction of a cent more. They wouldn't even notice, right? And while technically, the roads would wear out faster, the amount is also negligible. So you could argue, why not let this one person be a free rider?</p>

<p>There are 2 problems with this:</p>

<ol>
<li><p>This argument applies (individually) to everyone. You could argue it for you, I could argue it for me, and so on. The more people that are exempt, the bigger the cost to the remainder. Eventually it DOES mean that people will need to pay more.</p></li>
<li><p>If individuals are exempt, then those that do pay, consider this unfair. Why should I pay, if you don't have to? Collecting the money to make roads becomes harder, and at some point, there might be civil unrest by the people paying.</p></li>
</ol>

<p>Both of these are issues, for example, with tax collection. Some companies are exempt - for example, if a company has enough negotiating power, they can talk themselves out of taxes (or some part of taxes); if the (local or national) government does not agree, they will go elsewhere. Once one company succeeds, other companies will use the same tactic.</p>

<p>Then, when individuals realise that many companies are not paying taxes, they get (understandably) upset. This strongly links to how fair people think a particular exemption is - if someone has no income, they will not pay income tax, this would not cause people to be upset. However, if someone has millions of dollars in an overseas tax haven, and they pay no tax, or if a company doesn't pay tax because they buy their product from an overseas parent company at the exact price that they don't make a profit, people get upset.</p>

<p>There is also a related cost to potential "free riders" - if the ambulance is paid for by the insurance companies, they might not come to the aid of the uninsured "free riders". The cost of this is also born by the insured - if you are insured, but can't prove it, will you be left behind?</p>

CC BY-SA 4.0
2018-08-01T02:45:11.980Z
Nice writeup.  You didn't provide a *solution,* which was probably wise; it wasn't asked for and the solutions are all contentious.  You described quite thoroughly why it IS a problem, which is what the question was.
Wildcard
CC BY-SA 4.0
2018-08-02T19:01:59.823Z
@Wildcard, surely the assertion, by definition, is a solution in search of a problem. By starting with "free-rider", it sets up a strawman for discussion. Street-lights are a saving, not a cost, as it it saves lives that will generate value for all. In addition, in the UK, 3 street lights within 100m creates a 'built up area' with an implicit 30mph speed limit that the police can use to help build up their stats and fines (been there, was surprised). So the solution is to stop calling folk 'free riders', as the exploit the asset to [economic] benefit. [5 minute rule]
Philip Oakley
CC BY-SA 4.0
2018-08-04T09:47:10.013Z
@PhilipOakley the solution to "freeriders of public infrastructure" is to gaol (jail) people who refuse to pay their taxes they are supposed to. Streetlights are, indeed, "a savings", but they are equally a savings for those that have paid for them (in the form of taxes) as those who refuse to pay the taxes they are supposed to. If taxes were optional, how many people would say "no thanks, I'll be a freerider". And if those people said that, how many people would then say "well, they're not paying, why should I?"
AMADANON Inc.
CC BY-SA 4.0
2018-08-01T01:31:48.457Z
2018-08-01T01:31:48.457Z
AMADANON Inc.
<p>It is a "problem" because if no one pays for the good or service (they are 'free' riding after all), sellers of that product have no incentive to produce it. If no one produces it, and the good or service is beneficial (e.g. national defense), then surely that is a "problem"? I don't think anyone wants to live in a country with no national defense.</p>

<p>The same logic applies to parks and emergency rooms. If no one pays, there won't be any parks or emergency rooms. If you are thinking that the govt. should pay for it instead, understand that the govt. has to get the resources to pay for it from somewhere. That leads to taxation. There is no such thing as a free lunch. <em>Someone</em> has to pay for it at the end of the day.</p>

CC BY-SA 4.0
2018-08-25T23:18:03.907Z
This is the best argument I’ve seen all week in favor of democratic socialism. Some things are both necessary and not organically produced in large enough quantities by the market. These are the things that should be produced by government and paid for by taxation.
Dave
CC BY-SA 4.0
2018-08-25T23:46:54.923Z
To clarify, I’m proposing a public option... If there is a type of good or service that everyone or almost everyone needs, then there should be a basic, not-for-profit government version of that good or service alongside whatever the market elects to offer. Those who want premium or more varied options and can afford them are free to pursue that. Those who cannot afford premium or who are satisfied with basic versions can exit the market without hardship.
Dave
CC BY-SA 4.0
2018-08-17T22:32:38.667Z
2018-08-17T22:32:38.667Z
Mishal Ahmed
<p>Surprisingly no one has mentioned the <a href="https://en.wikipedia.org/wiki/Tragedy_of_the_commons" rel="nofollow noreferrer">tragedy of the commons</a>. Having been born in the Soviet Union where everything was public and everyone was a free rider, I used to call it the tragedy of my life. But anecdotes aside, the problem with free riders is if they are allowed, eventually everyone becomes a free rider. Eventually, such a place deteriorates into, for a lack of a better word, a dumphole. Now, parks and other public infrastructure exist because government enforces tax collection equally and those parks are paid for and maintained mainly using taxes so in reality there are no free riders. There are those who pay, but don't use it. Same with public hospitals that the healthy never get to use, but they do pay taxes.</p>

<p>Public things can exist and be maintained in theory and practice in tight communities where free riding is nearly impossible to hide. Usually in at least seasonally isolated communities, by geography and/or climate. Examples are very small villages around the world or even sparsely populated countries with harsh climate like Scandinavia or Canada. There, a free rider wouldn't be much of a problem for anyone but himself because his identity would likely be a common knowledge and he would have little options to avoid punishment. Hence, an instance of free riding would never get a chance to snowball into the tragedy of the commons.</p>

CC BY-SA 4.0
2018-08-04T09:53:04.463Z
It is not possible for "everyone to be a freerider" for anything that has a cost - someone must have paid for it in advance - the money (or labour, or other cost) has to come from somewhere - it may be tax, or volunteer labour, or forced labour (or any of the same provided by previous generations).
AMADANON Inc.
CC BY-SA 4.0
2018-08-04T10:08:34.997Z
@AMADANONInc. you got it right: forced labor + forced consumption. At the end forced labor ran out and the 'free' stagnated into ruin. Command economies do have their accounting systems that track all those costs, but mostly they just write up the numbers they want and declare them truth, forcefully dealing with anyone who disagrees. Not a lot of fun digging it all up, to be honest.
Arthur Tarasov
CC BY-SA 4.0
2018-08-01T13:02:42.533Z
2018-08-01T13:02:42.533Z
Arthur Tarasov
<p>Why is it bad that someone can use something like a park or an emergency room without paying?</p>

CC BY-SA 4.0
2018-07-30T20:26:38.713Z
I'm voting to close this question as off-topic because it seems to be about the meaning of the word '[problem](https://en.wiktionary.org/wiki/problem#Noun)', not economics.
Giskard
CC BY-SA 4.0
2018-07-30T20:27:24.687Z
That isn’t the case at all.
Dave
CC BY-SA 4.0
2018-07-30T21:15:12.380Z
Then could you please expand on your question. The way it is now phrased seems to imply that economists claim people using the emergency room without paying is "bad". I don't think this is the case, so please either clarify what you mean or get an appropriate source for your claim.
Giskard
CC BY-SA 4.0
2018-07-30T21:36:16.260Z
My question is why is the phenomenon commonly referred to as “the free rider problem” a problem? Does that help you? “Problem” implies something that is bad. By referring to free riding as a “problem” economists are calling free riding bad.
Dave
CC BY-SA 4.0
2018-07-30T21:37:49.653Z
'Problem' does not always implies that something is bad, please click the link in my first comment to see several alternative and more nuanced meanings.
Giskard
CC BY-SA 4.0
2018-07-31T00:47:59.403Z
Are you referring to [the tragedy of the commons](https://en.wikipedia.org/wiki/Tragedy_of_the_commons)?
Peter Mortensen
CC BY-SA 4.0
2018-07-31T08:19:36.457Z
@denesp "The free-rider problem is the question of how to limit free riding and its negative effects in these situations" [from Wikipedia](https://en.wikipedia.org/wiki/Free-rider_problem). It seems "problem" can be interpreted both as "difficulty" and "question" in this context
JollyJoker
CC BY-SA 4.0
2018-07-31T11:22:53.663Z
It isn't bad *in a given specific case*, it is very much a problem *in general* as it disincentivises the creation of parks and emergency rooms. I agree with @denesp that you are arguing semantics rather than economics. To perhaps give the intuition I'll give you the speculative question that my parents gave to me as a child: "what would happen if *everyone* did that"?
Jared Smith
CC BY-SA 4.0
2018-07-31T19:58:11.370Z
I would ask this in Philosophy SE
JacobIRR
CC BY-SA 4.0
2018-08-01T11:56:32.253Z
All the answers basically answer the question "What is the free rider problem?" which probably means that this question should be reworded somewhat.
NoDataDumpNoContribution
<free-riding>
Why is the Free Rider Problem a problem?
Dave
# Why is the Free Rider Problem a problem?

(Asked by: username_0 on 2018-07-30)

Why is it bad that someone can use something like a park or an emergency room without paying?

**Tags:** free-riding

> **Comments:**
> **username_1**: I'm voting to close this question as off-topic because it seems to be about the meaning of the word '[problem](https://en.wiktionary.org/wiki/problem#Noun)', not economics.  
> **username_0**: That isn’t the case at all.  
> **username_1**: Then could you please expand on your question. The way it is now phrased seems to imply that economists claim people using the emergency room without paying is "bad". I don't think this is the case, so please either clarify what you mean or get an appropriate source for your claim.  
> **username_0**: My question is why is the phenomenon commonly referred to as “the free rider problem” a problem? Does that help you? “Problem” implies something that is bad. By referring to free riding as a “problem” economists are calling free riding bad.  
> **username_1**: 'Problem' does not always implies that something is bad, please click the link in my first comment to see several alternative and more nuanced meanings.  
> **username_2**: Are you referring to [the tragedy of the commons](https://en.wikipedia.org/wiki/Tragedy_of_the_commons)?  
> **username_3**: @denesp "The free-rider problem is the question of how to limit free riding and its negative effects in these situations" [from Wikipedia](https://en.wikipedia.org/wiki/Free-rider_problem). It seems "problem" can be interpreted both as "difficulty" and "question" in this context  
> **username_4**: It isn't bad *in a given specific case*, it is very much a problem *in general* as it disincentivises the creation of parks and emergency rooms. I agree with @denesp that you are arguing semantics rather than economics. To perhaps give the intuition I'll give you the speculative question that my parents gave to me as a child: "what would happen if *everyone* did that"?  
> **username_5**: I would ask this in Philosophy SE  
> **username_6**: All the answers basically answer the question "What is the free rider problem?" which probably means that this question should be reworded somewhat.  

---

## 4 answers

### Answer by username_7 on 2018-07-31. Score: 6

The existing answers are covering mostly only situations where the 'free riders' aren't using up anything. It's important to note that an emergency room is *absolutely not* such an example. Someone who is not paying for an emergency room visit *is* using up someone else's resources without compensating them. They are taking up an ER room that could be used by other patients, taking up time of the doctors, nurses, and other staff, and using up consumable goods such as medications, gloves, needles, etc. All of this costs money.

As a result of the free rider, everyone else is paying more, receiving worse service, or both compared to what they would have if the 'free rider' either paid their share or weren't present.


---

### Answer by username_8 on 2018-08-01. Score: 2

There are other aspects, which (I think) has not been mentioned by other answers.

If people have the choice to pay for something, or to be a free rider, almost everyone will choose to be a free rider. If everyone pays their fair share (for some definition of "fair share") of the cost of road building & maintenance, and the roads get built, then everyone benefits.

If username_0 is the a free rider, the roads will still get built. In a country with a population of millions of people, everyone else will only need to pay a fraction of a cent more. They wouldn't even notice, right? And while technically, the roads would wear out faster, the amount is also negligible. So you could argue, why not let this one person be a free rider?

There are 2 problems with this:

1. This argument applies (individually) to everyone. You could argue it for you, I could argue it for me, and so on. The more people that are exempt, the bigger the cost to the remainder. Eventually it DOES mean that people will need to pay more.
2. If individuals are exempt, then those that do pay, consider this unfair. Why should I pay, if you don't have to? Collecting the money to make roads becomes harder, and at some point, there might be civil unrest by the people paying.

Both of these are issues, for example, with tax collection. Some companies are exempt - for example, if a company has enough negotiating power, they can talk themselves out of taxes (or some part of taxes); if the (local or national) government does not agree, they will go elsewhere. Once one company succeeds, other companies will use the same tactic.

Then, when individuals realise that many companies are not paying taxes, they get (understandably) upset. This strongly links to how fair people think a particular exemption is - if someone has no income, they will not pay income tax, this would not cause people to be upset. However, if someone has millions of dollars in an overseas tax haven, and they pay no tax, or if a company doesn't pay tax because they buy their product from an overseas parent company at the exact price that they don't make a profit, people get upset.

There is also a related cost to potential "free riders" - if the ambulance is paid for by the insurance companies, they might not come to the aid of the uninsured "free riders". The cost of this is also born by the insured - if you are insured, but can't prove it, will you be left behind?

> **Comments:**
> **username_9**: Nice writeup.  You didn't provide a *solution,* which was probably wise; it wasn't asked for and the solutions are all contentious.  You described quite thoroughly why it IS a problem, which is what the question was.  
> **username_10**: @username_9, surely the assertion, by definition, is a solution in search of a problem. By starting with "free-rider", it sets up a strawman for discussion. Street-lights are a saving, not a cost, as it it saves lives that will generate value for all. In addition, in the UK, 3 street lights within 100m creates a 'built up area' with an implicit 30mph speed limit that the police can use to help build up their stats and fines (been there, was surprised). So the solution is to stop calling folk 'free riders', as the exploit the asset to [economic] benefit. [5 minute rule]  
> **username_8**: @PhilipOakley the solution to "freeriders of public infrastructure" is to gaol (jail) people who refuse to pay their taxes they are supposed to. Streetlights are, indeed, "a savings", but they are equally a savings for those that have paid for them (in the form of taxes) as those who refuse to pay the taxes they are supposed to. If taxes were optional, how many people would say "no thanks, I'll be a freerider". And if those people said that, how many people would then say "well, they're not paying, why should I?"  

---

### Answer by username_11 on 2018-08-17. Score: 2

It is a "problem" because if no one pays for the good or service (they are 'free' riding after all), sellers of that product have no incentive to produce it. If no one produces it, and the good or service is beneficial (e.g. national defense), then surely that is a "problem"? I don't think anyone wants to live in a country with no national defense.

The same logic applies to parks and emergency rooms. If no one pays, there won't be any parks or emergency rooms. If you are thinking that the govt. should pay for it instead, understand that the govt. has to get the resources to pay for it from somewhere. That leads to taxation. There is no such thing as a free lunch. *Someone* has to pay for it at the end of the day.

> **Comments:**
> **username_0**: This is the best argument I’ve seen all week in favor of democratic socialism. Some things are both necessary and not organically produced in large enough quantities by the market. These are the things that should be produced by government and paid for by taxation.  
> **username_0**: To clarify, I’m proposing a public option... If there is a type of good or service that everyone or almost everyone needs, then there should be a basic, not-for-profit government version of that good or service alongside whatever the market elects to offer. Those who want premium or more varied options and can afford them are free to pursue that. Those who cannot afford premium or who are satisfied with basic versions can exit the market without hardship.  

---

### Answer by username_12 on 2018-08-01. Score: 2

Surprisingly no one has mentioned the [tragedy of the commons](https://en.wikipedia.org/wiki/Tragedy_of_the_commons). Having been born in the Soviet Union where everything was public and everyone was a free rider, I used to call it the tragedy of my life. But anecdotes aside, the problem with free riders is if they are allowed, eventually everyone becomes a free rider. Eventually, such a place deteriorates into, for a lack of a better word, a dumphole. Now, parks and other public infrastructure exist because government enforces tax collection equally and those parks are paid for and maintained mainly using taxes so in reality there are no free riders. There are those who pay, but don't use it. Same with public hospitals that the healthy never get to use, but they do pay taxes.

Public things can exist and be maintained in theory and practice in tight communities where free riding is nearly impossible to hide. Usually in at least seasonally isolated communities, by geography and/or climate. Examples are very small villages around the world or even sparsely populated countries with harsh climate like Scandinavia or Canada. There, a free rider wouldn't be much of a problem for anyone but himself because his identity would likely be a common knowledge and he would have little options to avoid punishment. Hence, an instance of free riding would never get a chance to snowball into the tragedy of the commons.

> **Comments:**
> **username_8**: It is not possible for "everyone to be a freerider" for anything that has a cost - someone must have paid for it in advance - the money (or labour, or other cost) has to come from somewhere - it may be tax, or volunteer labour, or forced labour (or any of the same provided by previous generations).  
> **username_12**: @AMADANONInc. you got it right: forced labor + forced consumption. At the end forced labor ran out and the 'free' stagnated into ruin. Command economies do have their accounting systems that track all those costs, but mostly they just write up the numbers they want and declare them truth, forcefully dealing with anyone who disagrees. Not a lot of fun digging it all up, to be honest.  

---

