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{{Short description|Someone required to pay for something they don't want}}
{{Short description|Someone required to pay for something they don't want}}
{{Use mdy dates|date = March 2019}}
{{Use mdy dates|date = March 2019}}
{{notability|date=September 2021}}

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 desiring them or valuing them at their price. Such goods are typically [[non-excludable]]<ref>{{cite web|last=Cowan|first=Tyler|title=Concise Encyclopedia of Economics |url=http://www.econlib.org/library/Enc/PublicGoods.html |work=Public Goods |publisher=Library of Economics and Liberty |accessdate=27 February 2013}}</ref><ref>{{cite book|url=https://books.google.com/books?id=4neLQXRNntkC&pg=PA111&dq=%22forced+riders%22&hl=en&sa=X&ei=gC0nUarxC9HOigK3oYHQAQ&ved=0CIIBEOgBMA4#v=onepage&q=%22forced%20riders%22&f=true |title=Austrian Methodology: The Preferred Tax Type |publisher=Books.google.com |date= |accessdate=2013-11-30}}</ref> and [[non-rivalrous]].
A '''forced rider''' in economics is a person who is required, by public or private entities, to share in the costs of goods or services without desiring them or valuing them at their price.


==Theory==
==Theory==
Public goods are non-excludable. As a result, some people may be required to contribute to the cost of public goods they would prefer not to support.<ref>[https://books.google.com/bookshl=en&lr=&id=4XxbYM8UMtwC&oi=fnd&pg=PA63&dq=samuelson+preference+revelation&ots=6MOaOgtG0F&sig=d_h_e_chvtGOHpEFM51aAVEn7VU#v=onepage&q=samuelson%20preference%20revelation&f=true Providing Global Public Goods]{{dead link|date=March 2013}}</ref><ref>[http://bbs.cenet.org.cn/UploadImages/200642020355785817.pdf Multipart pricing of public goods] {{Webarchive|url=https://web.archive.org/web/20131203060435/http://bbs.cenet.org.cn/UploadImages/200642020355785817.pdf# |date=2013-12-03 }} bbs.cenet.org.cn</ref> An example is compulsory tax payments, where the payees have no control on the usage of the taxes. This is called the "forced rider problem".<ref>{{cite web |url=http://sobek.colorado.edu/~mciverj/Ostrom-PG&PC.PDF |title=Public Goods and Public Choices |format=PDF |date= |accessdate=2013-11-30 |archive-url=https://web.archive.org/web/20050520201711/http://sobek.colorado.edu/~mciverj/Ostrom-PG%26PC.PDF# |archive-date=2005-05-20 |dead-url=yes |df= }}</ref> Due to the nature of a [[non-excludable]] good, they do still receive the benefits of the good they are forced to pay for via taxation or other compulsory payment. Therefore, the good tends to be over produced as there are more people paying for it as the ones who consume it or value it at its price. Without the obligation to pay for these goods or services, the public goods could become under produced. This can happen because a lot of people would try to avoid paying for them even if valuing the goods at their price. This problem, which is an opposite to forced rider problem, is called a [[Free-rider problem|free rider problem]]<ref name=":0">{{Cite web|url=http://rebirthofreason.com/Articles/Dwyer/Free_Riders_versus_Forced_Riders.shtml|title=Free Riders versus Forced Riders|website=rebirthofreason.com|access-date=2019-04-30}}</ref>.

=== Forced riders in taxation ===
=== Forced riders in taxation ===
The forced rider has been cited in various authors' views concerning taxation.
The forced rider has been cited in various authors' views concerning taxation.
* [[Pacifists]] are required to pay for [[national security|national defense]]<ref name="mises" /><ref>{{cite web|author=Richard Cornes Todd Sandler |url=http://jtp.sagepub.com/content/6/3/369 |title=Are Public Goods Myths? |publisher=Jtp.sagepub.com |date=1994-07-01 |accessdate=2013-11-30}}</ref><ref>{{cite book|url=https://books.google.com/books?id=BdnxxpsF2pMC |title=Modern Principles of Economics |publisher=Books.google.com |date= |accessdate=2013-11-30}}</ref>{{page needed|date=March 2013}}, even if they believe that the country will not be attacked<ref name=":0" />.
* [[Pacifists]] are required to pay for [[national security|national defense]].<ref name="mises" /><ref>{{cite web|author=Richard Cornes Todd Sandler |url=http://jtp.sagepub.com/content/6/3/369 |title=Are Public Goods Myths? |publisher=Jtp.sagepub.com |date=1994-07-01 |accessdate=2013-11-30}}</ref><ref>{{cite book|url=https://books.google.com/books?id=BdnxxpsF2pMC |title=Modern Principles of Economics |date= October 9, 2009|isbn=9781429202275 |accessdate=2013-11-30|last1=Cowen |first1=Tyler |last2=Tabarrok |first2=Alex |publisher=Macmillan }}</ref>{{page needed|date=March 2013}}
* [[Environmentalists]] may be required to pay for public works projects, such as dams, which they feel destroy natural habitats in ways they do not condone.<ref name="mises">{{cite web|url=http://mises.org/rothbard/myth.pdf |title=The Myth of Neutral Taxation |format=PDF |date= |accessdate=2013-11-30}}</ref>
* [[Environmentalists]] may be required to pay for public works projects, such as dams, which they feel destroy natural habitats in ways they do not condone.<ref name="mises">{{cite web|url=http://mises.org/rothbard/myth.pdf |title=The Myth of Neutral Taxation |date= July 20, 2005|accessdate=2013-11-30}}</ref>
* Healthy and insured individuals being forced via an [[individual mandate]] to subsidize insurance for unhealthy and previously uninsured individuals. Previously uninsured individuals are now [[free riders]].{{cn|date=November 2013}}
*[[Insurance]] payers are often required to pay for services which are highly improbable to happen, such as a [[natural disaster]]<ref name=":0" />.
* In many European countries, every household is required to purchase a [[television licence]] whether they watch television or not.
* Childless adults are required to pay for the public education of others' children. Additionally, parents whose children are not using the public school system, such as those enrolled in private or charter schools in the US, are still required to pay for other children's public education, as well.

=== Forced riders in private property ===
* In a unionized workplace, non-union as well as union members are required to pay dues to the union representing the workplace as a condition of employment.<ref>{{cite web|author=Gary Galles |url=https://mises.org/wire/union-dues-and-free-rider-problem |title=Union Dues and the "Free Rider" Problem |publisher=mises.org |date=1994-07-01 |accessdate=2019-08-11}}</ref> This is the case in [[agency shop]] union security agreements.

==See also==
*[[Accessibility (transport)]]
*[[Automotive city]]
*[[Ghetto tax]]
*[[Redlining]]
*[[Transit desert]]
*[[Transport divide]]


==References==
==References==

Latest revision as of 04:20, 19 May 2024

A forced rider in economics is a person who is required, by public or private entities, to share in the costs of goods or services without desiring them or valuing them at their price.

Theory

[edit]

Forced riders in taxation

[edit]

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

  • Pacifists are required to pay for national defense.[1][2][3][page needed]
  • Environmentalists may be required to pay for public works projects, such as dams, which they feel destroy natural habitats in ways they do not condone.[1]
  • Healthy and insured individuals being forced via an individual mandate to subsidize insurance for unhealthy and previously uninsured individuals. Previously uninsured individuals are now free riders.[citation needed]
  • In many European countries, every household is required to purchase a television licence whether they watch television or not.
  • Childless adults are required to pay for the public education of others' children. Additionally, parents whose children are not using the public school system, such as those enrolled in private or charter schools in the US, are still required to pay for other children's public education, as well.

Forced riders in private property

[edit]
  • In a unionized workplace, non-union as well as union members are required to pay dues to the union representing the workplace as a condition of employment.[4] This is the case in agency shop union security agreements.

See also

[edit]

References

[edit]
  1. ^ a b "The Myth of Neutral Taxation" (PDF). July 20, 2005. Retrieved November 30, 2013.
  2. ^ Richard Cornes Todd Sandler (July 1, 1994). "Are Public Goods Myths?". Jtp.sagepub.com. Retrieved November 30, 2013.
  3. ^ Cowen, Tyler; Tabarrok, Alex (October 9, 2009). Modern Principles of Economics. Macmillan. ISBN 9781429202275. Retrieved November 30, 2013.
  4. ^ Gary Galles (July 1, 1994). "Union Dues and the "Free Rider" Problem". mises.org. Retrieved August 11, 2019.