What is the free-rider problem? Why do free riders make the private provision of a public good

Question:

What is the free-rider problem? Why do free riders make the private provision of a public good inefficient?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Microeconomics

ISBN: 978-0133019940

11th edition

Authors: Michael Parkin

See More Books

Question Posted: Dec 15, 2015 07:25 AM

See More Questions

In exercise 27.1 we extended our analysis of subsidized voluntary giving from 2 to N people. In the process, we simply assumed the government would set t to cover its costs and that individuals...
What mechanisms allow corporate raiders to get around the free rider problem in takeovers?
Economists believe the free rider problem is very important in complex business organizational structures. Still, businesses continue to build teams to solve problems or to deliver products to...
The controller of Northwest Hardware has just received two forecasts for sales in the Montana District for the coming year. Based on an econometric analysis of consumer spending and economic trends,...
The following Venn diagram describes the sample space of a particular experiment and events A and B : a. Suppose the sample points are equally likely. Find P (A) and P (B). b. Suppose P(1) = P(2) =...
Refer to the data set in Table. a. Construct a crosstabulation with Year Founded as the row variable and % Graduate as the column variable. Use classes starting with 1600 and ending with 2000 in...
Enumerate the functions related to the production cycle.
Trevor Harty, an avid mountain biker, always wanted to start a business selling top-of-the-line mountain bikes and other outdoor supplies. A little over 6 years ago, he and a silent partner opened a...
Claudia is self-employed and earns $190,000 p.a. If she makes a tax deductible (concessional) contribution to superannuation of $15,000, will she save tax and if so, how much? Exclude Medicare Levy/...
Viola Holloway and Renee Forrow are the sole equal shareholders in the corporation of Holloway And Forrow Enterprises, Inc. The Ilolloway And Eomow Enterprises, Inc. owns the following depreciable...
What are the problems that arise from public goods, common resources, natural monopoly goods, and mixed goods?
Under what conditions will competition among politicians for votes result in an efficient provision of a public good?
You are pushing a large crate from the back of a freight elevator to the front as the elevator is moving to the next floor. In which situation is the force you must apply to move the crate the least,...
What kind of partners and resources will you need? When will you need these?
What is your overall strategy? Why does this strategy help you sell to customers? What is your cost to acquire customers (CAC)? Does this exceed the customer lifetime value (CLTV)?
Pull the income sheets from three companies in the industry that you are interested in entering. Try to find companies that are pursuing different strategies. Examine their business models, and see...
How do you segment your market? Whos your PTA, your core customer? Who are your STAs?
What primary data will you collect?
Determine the best investment: compounding quarterly at 3.1% or compounding daily at 2.9%.
On January 1, 2018, Khalid Ltd., which follows IAS 17, entered into an eight-year lease agreement for three dryers. Annual lease payments for the equipment are $28,500 at the beginning of each lease...
Amid soaring oil prices the Commodity Futures Trading Commission (CFTC) is looking into manipulation of the oil marketwithholding oil in an attempt to drive prices higher. The CFTC has found such...
List the economic functions of governments.
Why are healthcare and education not public goods and why do governments play a large role in the markets for these services?
Johnny's Lunches is considering purchasing a new, energy-efficient grill. The grill will cost $31,000 and will be depreciated straight-line over 10 years to a salvage value of zero. The grill will...
John wants to "roll in" or finance the loan fee of $3,800 into the loan amount which would make the loan $90,800 and the interest rate is 6%. Assume that the lender agrees to allow the loan fees to...
A company is faced with the decision of whether to lease or purchase new equipment. The equipment can be leased at an annual cost of $210,000 or purchased for $560,000. The equipment has an expected...

What is the free-rider problem? Why do free riders make the private provision of a public good

Question:

Step by Step Answer:

If a firm were to provide a public good it would suffer from the freerider ...View the full answer

Microeconomics

Students also viewed these Economics questions