Free Rider
Free Rider
The datum for any discussion on free riding and collective action is economist Mancur Olson’s (1932–1998) The Logic of Collective Action (1965). Olson’s thesis was a reaction to the pluralist view that when a political, social, or economic problem impinges significantly on the life of a citizen, he or she instinctively acts collectively on the basis of shared concern. Olson’s counterargument was that: (1) mobilization was not a natural or spontaneous process; (2) not all potential groups would materialize; and (3) membership would be lower than pluralists envisaged. Olson proposed that large numbers of rational potential members of groups seeking collective (nonexcludable) goods free ride these organizations because any benefits gained will be freely available to them without incurring the costs of membership. Indeed, as Russell Hardin (2003) notes “free riding [in large groups] is often clearly in the interest of most and perhaps all members.” Thus, for Olson, rational participators are special cases: they are either coerced to participate (e.g., compulsory membership as in trade union “closed shops”) or they are attracted by selective incentives only available to members. In small groups, free riding can be assuaged by the imposition of sanctions while free riders remain group members, or by excluding free riders (Page et al. 2005). As Page et al. highlight, “under favourable conditions, where the opportunities of entry and exit are symmetrically balanced, a process of voluntary association can mitigate the free-rider problem” (2005, p. 1032). Accordingly, “people are often observed to cooperate effectively in work groups, in local public goods provision, and in other settings” (Page et al 2005, p. 1050).
Many scholars have argued that Olson’s work has been discredited (i.e., the collective action paradox has been negotiated) by several developments: (1) the advocacy explosion (that began in the mid-1960s) witnessed the emergence of large numbers of (public interest) groups that Olson said should not exist; (2) large numbers of citizens joined these organizations; and (3) numerous surveys demonstrate that members join for collective, not economically self-interested, ends. However, Olson’s rebuttal to these critiques was pointed and persuasive. He argued that many of these groups offered selective incentives to stimulate membership and that membership—and political lobbying—were in fact the by-product (i.e., not the primary reason for membership). He also maintained that membership levels in these groups were suboptimal—these entities mobilized only a small fraction of the latent membership—and many potential members choose to free ride. Accordingly, some interests would be underresourced in comparison with the public support they reflected, and other interests would be easier to mobilize (e.g., business).
Olson and supporters such as Hardin also argue that surveys of joiners reveal little about the larger group of those who refuse to join. Olson accepted that (trivial) numbers of members would join (in addition to those seeking selective benefits), but he argued that the number joining for collective goods would be dwarfed by those failing to participate. He cited two examples in support of this argument. First, he argued that “tens of millions of Americans” believed the population should not grow, but only a “miniscule minority of 12,000” were members of the group Zero Population Growth (Olson 1979, p. 149). Secondly, he (conservatively) estimated that more than fifty million Americans valued “a wholesome environment, but in a typical year probably fewer than one in a hundred pays dues to any organization whose main activity is lobbying for a better environment” (Olson 1982, pp. 34–35). For Olson, all these nonmembers are free riders.
Finally, it is worth highlighting that in his arguments Olson makes the loose assumption that those who in some general way support a cause, and do not join, are free riding. Critics argue that such ubiquitous labeling of nonparticipation stretches the free-riding concept too far. It does not necessarily follow, for example, that those who share a concern about the environment with members of environmental groups also agree with the goals or strategies of environmental organizations, or believe that the groups’ activities will produce desirable outcomes, or consider the groups to be efficient (see Jordan and Maloney [2006] for a fuller exposition of this argument). Nonparticipation can emerge from noneconomically rational reasons.
SEE ALSO Collective Action; Tragedy of the Commons; Transaction Cost
BIBLIOGRAPHY
Hardin, Russell. 2003. The Free Rider Problem. In The Stanford Encyclopedia of Philosophy, ed. Edward N. Zalta. Stanford, CA: Metaphysics Research Lab Center for the Study of Language and Information. http://plato.stanford.edu/entries/free-rider/.
Jordan, Grant, and William A. Maloney. 2006. “Letting George Do It”: Accounting for Low Participation Rates? Journal of Elections, Public Opinion, and Parties 16 (2): 115–139.
Olson, Mancur. 1965. The Logic of Collective Action: Public Goods and the Theory of Groups. Cambridge, MA: Harvard University Press.
Olson, Mancur. 1979. Epilogue: Letter to Denton Morrison. Research in Social Movements, Conflicts, and Change 2: 149–150.
Olson, Mancur. 1982. The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities. New Haven, CT: Yale University Press.
Page, Talbot, Louis Putterman, and Bulent Unel. 2005. Voluntary Association in Public Goods Experiments: Reciprocity, Mimicry, and Efficiency. Economic Journal 115: 1032–1053.
William A. Maloney