What is the free-rider problem? What results from the free-rider problem? What is a solution to the free-rider problem?
What will be an ideal response?
The free-rider problem occurs when people enjoy the benefits from a good or service without paying for it. The free-rider problem occurs with public goods because no one can be excluded from using them without paying for them. As a result, the free-rider problem is that the private market produces too little of these goods. To produce the efficient quantity, the government can intervene by taxing people and using those funds to pay for the public good.
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Rent seekers are those who seek to
a. use the government to protect their existing property interests b. use the government to change the rules of the market game in their favor c. convert public land into private land d. convert public resources into private resources e. maximize their own private gains from trade
Full employment to the classical school means that all workers
a. in the labor market are employed b. at any given wage rate are or will be employed c. who work at the equilibrium wage rate would not have been willing to work for less or more d. who are willing to work at the equilibrium wage rate are employed e. who are in the labor force are employed all the time