The New York Times is gradually tightening the belt on free content. Those of you who enjoy this blog free of charge and express your displeasure that 1M/1M premium is a paid program and that we do not offer our self-assessment content free disregard that the cost of running this operation – this effort at global entrepreneurship development – is not zero. But it takes resources to offer those games free, creating a question of fairness and sustainability. To give you an example, only 2% of the customers who play their games pay any money to Zynga. ![]() From the West’s massive budget, debt and deficit crisis to support welfare economics, to the Internet’s rampant appetite for free resources – products, services, and content – the situation is unsustainable. Unfortunately, the system we operate under today is a colossal free rider problem in action. Another example of a free rider is someone who does not pay his or her share of taxes, which help pay for public goods that all citizens benefit from, such as roads, water treatment plants, and fire services.Īs we think through the restructuring of capitalism as a system, we need to look carefully at the free rider problem. If too many people do this, the system will not have enough money to operate. ![]() The term free rider comes from the example of someone using public transportation without paying the fare. Free riding is usually considered to be an economic problem only when it leads to the non-production or under-production of a public good (and thus to Pareto inefficiency), or when it leads to the excessive use of a common property resource. The free rider problem is the question of how to limit free riding (or its negative effects). In economics, collective bargaining, psychology, and political science, a free rider (or freeloader) is someone who consumes a resource without paying for it, or pays less than the full cost. To refresh everyone’s memory, here is Wikipedia’s definition of the concept: If you have studied economics, you are familiar with the free rider problem.
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