Forced rider

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A forced rider in economics is a person who is required, by government or other collective, to share in the costs of goods or services without benefiting from them. Such goods are typically non-excludable.[1][2]

Theory[edit]

Public goods are non-excludable and non-rivalrous. As a result, some people may benefit from a public good without helping to cover the costs of production. This is known as the "free rider problem".[3][4]

Collective payment schemes, such as taxes, have historically been used to address the free rider problem. However, compulsory payments may create situations in which individuals are required to contribute to the cost of public goods from which they receive no benefit. This is called the "forced rider problem".[5]

Forced riders in taxation[edit]

The forced rider has been cited in various authors' views concerning taxation.

References[edit]

  1. ^ Cowan, Tyler. "Concise Encyclopedia of Economics". Public Goods. Library of Economics and Liberty. Retrieved 27 February 2013. 
  2. ^ Austrian Methodology: The Preferred Tax Type. Books.google.com. Retrieved 2013-11-30. 
  3. ^ Providing Global Public Goods[dead link]
  4. ^ Multipart pricing of public goods bbs.cenet.org.cn
  5. ^ "Public Goods and Public Choices" (PDF). Retrieved 2013-11-30. 
  6. ^ a b "The Myth of Neutral Taxation" (PDF). Retrieved 2013-11-30. 
  7. ^ Richard Cornes Todd Sandler (1994-07-01). "Are Public Goods Myths?". Jtp.sagepub.com. Retrieved 2013-11-30. 
  8. ^ Modern Principles of Economics. Books.google.com. Retrieved 2013-11-30.