What about free riders?

Hopefully I've examined the idea that even in an economy where all work is voluntary, there is reason to believe that people will work - survival, diffuse reciprocity, moral concern, self-actualisation, and so on. But in the scenario that I laid out, there was the possibility that one person would do all the work, and the other person would receive gifts without doing any work. So even if some people are motivated to work, what about those who receive the benefits of the work but don't themselves work? Is there a problem here? If so, what sort of problem is it, and does it bring down the whole idea?

So in the next three articles, starting here, I want to examine the idea of "free riders" - people who would not work but receive the benefit of others' work. And the short answer is, I think, that the economy can have more free riders than we might imagine, we have less free riders than we might think, and they don't really pose all that much of a problem.

What are free riders?

Free riders are people who receive benefits from the contributions of others without making contributions themselves, and especially so in the context of contributors not desiring to either (a) pay for non-contributors, or (b) over-contribute when there are more potential contributors.

For example, assume in an exchange economy that tax-payers pay for roads, but that non-tax-payers can drive on the roads. The non-payers are, in this case, free riders. the same can apply to all sorts of common property situations, such as the quality of air and water, physical infrastructure, and even legal and conceptual infrastructure, including education.

Interestingly, a free rider is a constructed notion, depending on the discourse that it conceptualised within. Take the following example: a person is a tax-payer and their taxes contribute to the roads. Another person is not a tax-payer and does not contribute to the roads, but can drive on them. If the tax-payer does not intend or appreciate that their contributions also allow a benefit to the non-tax-payer, then the non-tax-payer is a free rider. If, on the other hand, part of the point of the taxation system is that some people can pay more taxes than others and have a social or moral obligation to do so, and an obligation to assist those in disadvantage, then they absolutely intend for the non-tax-payer to drive on the road. In that case, the non-tax-payer is not a free rider.

Another example from an exchange economy: a bakery makes food in bulk. They are not certain how many customers they will receive that day (though they know the vague amount) and they are not sure what amount of each product they will purchase (though they know the vague amount). They cook batches of pies, danishes, croissants so that it is unlikely that they will have to turn a customer away. At the end of the day, there is some leftover food. Now let's say a person with no money comes along and has access to the leftover food at the end of the day. They are beneficiaries of the fact that the bakery is sustained by people making purchases (without which they would shut down and there would be no food), but they are not contributors. It is possible that the paying customers may think, "I had to pay for my food, but they get theirs for free?" and perceive the non-payers as free riders. Or, alternatively, they could think, "I am happy that the excess food goes to those who cannot pay, because they deserve food", in which case they are probably not perceived of as free riders.

Now, this is not the way the definition is always used. It is often the case that the non-payers who eat the bakery food are always considered free riders, but that the term has no negative connotations. On the other hand, deliberate recipients of positive externalities are not always considered free riders.

I mention this because one way of thinking about free riders in a non-reciprocal gifting economy is that they cannot, by definition, exist. This would be under the basis that all gifts are voluntary and deliberate, and therefore the contruction of someone receiving something against intention is an impossibility.

However, the issue is often raised, and it is worth attending to in the light that it has been raised in: is it a problem that some people receive benefits without contributing?

What's the issue with free riders?

There are three main issues with free riders: one of economic health, one of justice and fairness, and one of the intersection between the two.

In an exchange economy, one of the big issues with economic health posed by free riders is that of distorted signalling: that more people are using a good or service than there are signals for its demand (that is, money paying for it). Because signalling functions differently in a non-reciprocal gifting economy, this issue cannot occur in this way.

Another problem is that the ability to free ride might reduce the number of contributors and therefore reduce the quality of life or overall health of the economy. This is certainly an issue that can affect a non-reciprocal gifting economy. This is an issue that is similar to "Would people work?" and comes in the form of "Would enough people work?" If the opportunity exists to gain benefits without contributions, the rationally self-interested person would surely choose this particular option, and so we can expect that many people would. But if too many people choose this option, there will not be enough workers. I'll tackle this particular question in the very next article.

The other issue with free riders is one of justice and fairness. Let's say, for example, that there is a community of 100 people, and that 80 people can create enough food for the entire group. There is "room" for twenty people to not contribute and the economy to still be "healthy", in that everyone's needs are met. If 20 people decide not to work, and the other 80 people provide for them (under the motivation that if some workers fall ill they will need replacement workers), one possibility is that the 80 people will find the situation unjust. The notion of justice runs like this: there is no reason that one person more than another should be one of the ones to contribute, nor any reason that any particular person be the one that does not contribute. The fairest circumstance would be that each person contributes equally, which would mean each person contributing 80% of the time. Anyone who contributes less than that is free riding, and placing an extra burden on the people who contribute more.

The intersection of these two issues is the idea that people would stop contributing as a type of protest against those who were free riders, reducing the number of people working and negatively affecting economic health. Each person could ask themselves, "Why aren't I the person who doesn't have to work?" and then stop contributing. I'll try to examine some of the concerns that people might have in the following article on what really constitutes work, as well as examining a different way to conceive of this with a different model of justice, one not informed by the exchange but by the gift, in a much later section.

Who are free riders?

I raised a moment ago that who constitutes a free rider might depend on the attitude of the contributors. It's possible that contributors could have a range of attitudes toward non-contributors and that this variance has no impact on whether contributors are motivated to work or not, so it is worth examining the content of some of these evaluations.

Given that this particular look at it is attitudinal, it depends on the basis of these attitudes, which is usually whether or not the contributor considers that the non-contributor is "capable" of work or not. For example, most people are accepting that certain groups of people - typically children, the elderly, the injured, the unwell, and so on - are genuinely unable to contribute, and are therefore "exempt" from free-rider status. Instead, it is quite common to deliberately want to contribute toward these people with the explicit knowledge that they are not going to be contributing themselves.

There is still some scepticism aimed at these groups. Some people think that children could be contributing earlier, and others that the elderly can work for longer. Others are suspicious of whether people are truly ill, injured or disabled, given that there is a reasonable (though not necessarily commonly purused) motivation for pretence if a person can gain more while contributing less. For these reasons, there are often rather minimal resources directed to them, or punitive conditions to obtain those resources.

There are some groups that might be considered free riders dependent on what constitutes a contribution. For example, some accuse landlord or investors of being free riders because they are not contributing in terms of labour or effort, though others disagree because they are staking their resources and risk losing them. Other people have been born into wealth and don't need to contribute anything in order to have a luxurious life.

No matter the basis, there is likely to be disagreement on the line between acceptable non-contributor and free rider. For example, two people with the "same" injury might make different, good faith claims about whether they can work or not, while two different contributors might examine a single case of injury and come to two different conclusions about whether the injury genuinely prevents them from working or whether they are a free rider. There may be no good objective way to determine such a thing.

So what about the case of someone who is not injured, but who is completely unmotivated to work, whether because they feel that the motivation doesn't exist or because they feel resentment because they are asked to contribute. Well, it is entirely plausible that someone would consider such a position unreasonable. But, given that there are some very reasonable motivations to contribute, why would someone hold such an unreasonable position? Wouldn't it be self-sabotaging? And so we might conclude that there is some wellness issue at play here - that severe demotivation, irrationality or anger is perhaps a mental health issue. Now, some won't believe that such things are a mental health issue - they will believe that it is more likely they are using this as an excuse to benefit from the work of others without contributing - while others may believe it is a mental health issue but not one that would genuinely stop them from contributing. Others, again, would believe that these people are not free riders.

I raise this not to make a particular claim about any specific group of people, but instead to note that it is, in fact, very hard to pin down where the line might be between free rider and acceptable non-contributor. And any time I see people trying to draw some distinct line between two groups like this, I must admit that I become sceptical that such a line is likely worth drawing at all. That line is drawn by a discourse - a way of talking about things that justifies the use of power - and so what we are seeing here is a debate about who should have power over who, such as the power to withhold resources or compel work. And it is my tendency to think that this debate is one that stems from the nature of the exchange - the motivation to accrue exchange capacity, and the notion of justice as the completion of an exchange that satisfies a moral debt.

So I will go out on a limb here and say that the desire to determine who is and who isn't a free rider is something that mostly makes sense within the framework of the exchange and the concepts of justice that are often packaged up with it. In the next article I'll tackle whether enough people will be motivated to contribute to the economy, and in the article after that I'll look at what constitutes work and ask if there are really as many free riders as we might expect. But a little further down the line I'll also describe a theory of justice - justice as caring - that suggests that the attitude of trying to figure out who is a free rider is perhaps misplaced and constructed by a concept of justice tied to a specific (and problematic) economic system.