I wrote an article the other day about the "dev tax" proposal in which I argued that it was, well, pretty fucked. Indeed, I argue that the proposal is quite similar in its principle-violating nature to a proposal that would seek to fund development via a "tiny" "one-time-only-we-promise" increase in the 21MM coin supply limit. If you haven't read that article yet, you should do so now as it's a real tour de force: The "Dev Tax" proposal is worse than I thought (and I thought it was pretty bad).
Today I've been thinking more about how the proposal relates to the so-called "free-rider problem," about which wikpedia says the following:
>In the social sciences, the free-rider problem is a type of market failure that occurs when those who benefit from resources, public goods (such as public roads or hospitals), or services of a communal nature do not pay for them or under-pay. Free riders are a problem because while not paying for the good (either directly through fees or tolls or indirectly through taxes), they may continue to access or use it. Thus, the good may be under-produced, overused or degraded.
Note that Bitcoin's block subsidy / inflation schedule is an attempt to solve a free-rider problem surrounding initial chain security (and, as an aside, also to solve the problem of the initial distribution of funds in a fair and competitive way). We (holders) obviously don't like having our holdings effectively diluted via the issuance of new coins. But we all benefit from the hash rate security those newly-issued coins incentivize. When the system is first starting out, how can we achieve a reasonable level of security when the demand for transactions (and the fees they're capable of generating) is going to be minuscule? Via an agreed-upon inflation schedule whereby every holder is obligated to subsidize hash rate security. There's arguably a similar free-rider problem surrounding the development of protocol software. But there are two critical differences between that free-rider problem and the one surrounding initial chain security. First, I think the problem relating to development is a lot smaller and easier to solve without hard-coding anything into the consensus protocol. Peter Rizun nicely summarizes why the free-rider problem re: protocol software development should not be viewed as an intractable one in his [recen
... keep reading on reddit ➡In socialism how does this system address the free rider issue? I know capitalism has free rider issues too, but I’d like to know more about how socialism attempts to reduce economic waste and drive organizational efficiency.
This post is not intended to discuss the merits or likely outcome of the Janus v. AFSCME case, but more how the free rider/compelled rider problem can be resolved.
I was reading this article called The myth of “free riders” in right-to-work states, and they made the case that the solution of the free rider/compelled rider argument between unions and "right to work" advocates is a "Worker's Choice" policy: release all unions from "exclusive bargaining" obligations and also prevent unions from compelling fees from non-members. I don't necessarily subscribe to this argument, but this is how it goes:
> The unions who choose to take advantage of the benefits of exclusive representation but do not want nonmembers benefitting from their services would no longer be forced to represent workers who do not pay.
> At the same time, workers would not be forced to accept the compensation and working conditions negotiated by the union, nor would they be forced to support union activities with which they may disagree. They would have the choice and the freedom to decide whether union representation benefits them.
It seems obvious that if a worker can't be compelled to pay dues to the union, then the union can't be compelled to represent the non-paying worker. It is now likely that the Supreme Court will decide in Janus that public sector workers cannot be compelled to pay union dues, while they also will not be allowed to bargain outside of the exclusive union contract. Even if rightly decided, the resulting situation seems untenable and a violation of the union's rights to free association.
Under the circumstances, would unions be amenable to an agreement where they were released from both their exclusive bargaining rights and also their obligations to represent non-members? Would employers (public or private) agree to this? How would an arrangement like this work in the real world? Would unions be able to collectively bargain better wages and benefits than a non-union individual, resulting in more people joining the union to gain access to the benefits?
What am I missing from the pro-labor and pro-"right to work" perspective?
The free rider problem of public goods is a type of market failure that arises from the nature of public goods. A public good is a good which is non-excludible and non-rivalrous. The provider of the good cannot exclude people who don’t pay from receiving it and one person’s consumption of the good does not reduce the amount that can be consumed by others. Because you receive the good irrespective of whether you pay for it or not, it is individually irrational to pay for the good. If every individual acts rationally then the good does not get produced because companies would make no money providing it.
National defence is one of the purest examples of a public good. If a foreign aggressor fired a missile at your country and it was knocked out of the air by your national defence system, you benefit from that defence whether you paid or not. If an invading army was intercepted and defeated by your army, you benefited from that defence whether you paid or not. The army can’t protect everyone except the people who didn’t pay.
Ancaps believe all government services should be provided by the market. If the provision of national defence was handled by private companies on a free market, it would be underprovided. If someone came to your door and offered to sell you something which you receive whether you pay or not, the rational strategy would be to not pay. Instead of paying $500 a year for a contract with DefenceCorp and getting no utility from that payment, it would be rational to spend it on an Xbox instead and free ride on whatever national defence ends up being produced by others. If an insufficient number of people buy a subscription to DefenceCorp, and it ends up not being produced, then you are a sucker who has just wasted your money. Furthermore your own individual contribution is negligible as to whether the good gets produced or not. Your $500 a year is a drop in the ocean of the astronomical fixed costs of a modern professional military. So for you individually, it makes no difference if you opt out.
The best way around the free rider problem is to have a state which uses taxes to pay for national defence. Markets are more efficient for private goods, but they are lousy for public goods. For this reason, an anarchocapitalist society would not be able to provide national defence.
Is there a certain percentage point of free riders at which a market will fail? Perhaps this is too general of a question that would depend on a number of factors. If you know of any research or articles addressing this question please let me know.
A made up example answer, a market will generally fail if 30% of consumers use a service without paying into said service. Information suggesting a tipping point such as this is what I hope to find.
“But how will ancapistan or a market anarchist society fund public goods like protection against asteroids or defense against invasion from a state military? How do you solve the free rider problem without force?” The answer is assurance contracts. More specifically dominant assurance contracts. Let me explain.
An assurance contract is a contract which initiates a crowdfunding project if and only if a minimum monetary and/or group member threshold is reached within a given time period. If the minimum threshold is reached, the monetary pledges are transferred to the project initiator/entrepreneur and the public good is provided. If it isn’t, the donors either get to keep their money or they receive a refund and the public good isn’t provided. The contract acts as an assurance for people worried about wasting their money on funding a project that can’t be completed due to a lack of sufficient funds and presents an all or nothing offer for any potential free riders.
A dominant assurance contract is a variation of this idea which adds an extra incentive for people to donate to a project. These contracts promise to pay all donors a fee if the minimum monetary and/or member threshold isn’t reached, thus allowing all donors to benefit whether or not the quorum succeeds. This way, entrepreneurs are more likely to profit and free riders are less likely to cause the public good to go under-provided. Also, multiple rounds of offers can be made, so if a quorum fails the first time around, useful information can be gathered to make improvements on the offer for the next round. The monetary compensation offered to donors in failed contracts also provides incentive for entrepreneurs to make offers which are more likely to succeed.
Here’s the original paper on dominant assurance contracts and an article on it for further information if anyone’s interested.
This is the best tl;dr I could make, original reduced by 96%. (I'm a bot)
> Here, we show that phasing out coal yields substantial local environmental and health benefits that outweigh the direct policy costs due to shortening of the energy supply.
> A, Direct annual policy cost and globally aggregated monetized values of local health and environmental effects across policy scenarios relative to the reference scenario.
> Direct annual policy cost is derived from macroeconomic consumption loss, human health impacts are valued through willingness-to-pay metric and environmental damages are valued through restoration cost.
> Figure 3 shows that almost all world regions exceed their direct policy cost of exiting coal by human health and environmental benefits until 2050.
> For most countries, and in particular, the world's largest CO2 emitters, we find local co-benefits of all examined climate policy scenarios of such large magnitude that they can play an important role to overcome the interregional and intergenerational free-rider problem of climate policy: their domestic monetized environmental and health benefits exceed direct policy cost, thus creating an incentive to act even if others do not.
> We then monetize health effects by willingness-to-pay valuation, environmental damages though potential land restoration cost and direct policy cost through macroeconomic consumption loss, constructing a unified metric of social cost.
Summary Source | FAQ | Feedback | Top keywords: policy^#1 cost^#2 global^#3 health^#4 emission^#5
Post found in /r/science and /r/de.
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A basic question but I didn't find any post specifically about this here.
for capitalist libertarians, we consider scenarii where externalities/non-excludable goods are involved (environment, infrastructures, education and other social work, security etc... there's no practical way to make the benefit match the contribution other than to set up a political authority)
I am a very uninformed person and I want to understand any disinformation spread about communism.
I know on granite it is, but I wondered if anyone had any experience with the imitation one that Honnold set.
If the majority of people in an anarchist federation want to do something that costs money and is beneficial to all people in a general area, how would you avoid all of the problems associated with the free rider problem such as people saying that they don't support whatever the thing is, because they want to benefit without contributing?
I (like almost all those who browse reddit, and probably most of you) spend the vast majority of my browsing reading/viewing posts that have already been heavily upvoted, especially in larger subreddits and for posts which require a significant time investment to consume.
For instance, my approach for /r/nosleep is basically:
- Sort by top of all time
- Read the most upvoted story that I haven't read yet
- Hide the story (for easier future navigation).
I'll vary this a little for slightly less upvoted stories that have premises that are of greater interest to me, but I think that this approach is close to the optimal way of reading the best NoSleep stories.
The issue, though, is that while this approach is personally beneficial for me and probably you, if everyone did it, the subreddit wouldn't function as well. I am effectively free-riding off all the people who were willing to read those stories when they were new and untested, when they could have read what would likely be better stories if they acted like me.
The "free rider problem" in economics occurs when people don't have to pay for something they benefit from, so it is "underprovided" compared to the theoretical "social optimum".
For example, there might be 10,000 NoSleep readers similar to me who would be theoretically willing to pay an average of $5 per year for a small increase in our perceived quality of the top stories. It may be the case that say, an extra 100 people reading and voting on an average of 10 hours of new and rising NoSleep stories per year would improve the signal-to-noise ratio enough to create this increase in quality. The average social benefit of each hour's browsing for these people would be $50 an hour, and they would gladly do it for considerably less, but because there isn't a plausible way to arrange a deal between people like me and people like them, they don't do it as much as they would and new voting is "underprovided".
(Note that the existence of people voting on new posts isn't a refutation of the free rider problem. There is obviously an incentive to vote on new posts (mostly the feeling of control of what others will see), but I'm saying this incentive isn't as large as it "should" be).
So what does this all mean? Well, if this analysis is correct we should be looking at ways to encourage early voting, particularly by people who are "good" critics.
The "bellwether" trophy seems like a decent concept. If you're very good at pre
... keep reading on reddit ➡I personally lean more on a liberal on social issues, but this question often baffles me. I find that people who have worked hard to obtain personal property can be upset that government sends resources to people in need. The people in need get items for free that others obtained through a friend or through labor. Even if is a gift from a friend or family that friend or family member probably obtained that item through some type of labor. So the idea that someone receives services or property through the government without putting their labor into it is a cheater. I would say a cheater is a person who obtains government resources and is undetermined the live in any other lifestyle which that person needs to put labor into earning certain types of resources even if they are capable. I also understand that taxes are used to provide these resources which is also obtained by labor. Some people who work for their labor believe this is a waste in resources for the cheaters of the population.
Cheaters tend to be despised for the lack of determination. The problem is that there are people who actually come across some unlucky financial problems. These resources may be used to benefit a person to happens to come across some bad luck. Does the cheaters in society justify eliminating government assistance programs? Also if the government makes a more stricter rubric system to prevent cheaters from obtaining free resources, doesn't that make it more difficult for the people who need those resources to obtain them? Also I can see how this could lead to various forms of discrimination by giving resources to one group in need over another. Because of this should the government ignore the idea of cheaters in the system?
I had lots of these questions run through my head a lot. I wonder what solutions have philosophers contributed to addressing this problem. Also what views do you have on this issue? I find that the free rider problem is often used as an argument to not give minorities any resources, but I do not believe everyone is a free rider/cheater.
P.s. Sorry for any grammatical errors that may be on this post.
From my understanding, in a communist society, a lot of private goods (goods like food that are both excludable and rivalrous) are treated as public goods (goods like fresh air, which are nonexcludable and nonrivalrous for the most part).
This leads to what is known as the Free Rider Problem in economics.
Let's take the premise that people respond to incentives: if something benefits them, then they are more inclined to do it. I wouldn't call it greed, although some do call it that, but I see greed as more than a conscious action. Responding to incentives is more subconscious. You do it without realizing it. Think of the Tragedy of the Commons. It wasn't an entirely conscious decision to overuse the commons: you overused it because there was no incentive to use it in moderation. The people in r/aww respond to incentives when they try to gain karma by posting pictures of their pets. They're not being "greedy" in the traditional sense.
Most free-market economists would predict that, in the absence of private property, there would be the degredation of good incentives that make market economies run smoothly and the creation of bad incentives (like free-riding). To the leftists: how do you respond to this criticism? I would prefer words, not links (I can respond to them better).
