Again, this means a government has to make a pre-emptive decision about how much is too much, and what can and can’t be tolerated in terms of use of public goods. Rather than charging someone for the problem, make sure it never happens. That's because even if you didn't make the choice, you will benefit from the product (you can’t exactly not defend the voters who didn’t vote for more defense, for example.) The political assumptions behind taxation are really tricky and governments could easily get into trouble. With tax, everyone pays, even if they had different levels of involvement in the decision-making, or used the service different amounts, or had different levels of responsibility in some other sense. But what if only half the population wanted the war to go ahead? It's not like having to defend more people will cost more money, because the war is being fought abroad anyway. But if one company starts polluting the air, should we tax all companies for repairing the damage? Another example: a country is going to war on another country's territory, so the government needs to pay for the military costs. More of us breathing doesn't exactly diminish the amount of air in the atmosphere. But that's not necessarily always fair.įor example: air is a good that suffers from the free-rider problem. These goods benefit everyone, so everyone should pay for them. You could even look at things like YouTube, Spotify, or Wikipedia for the same question-everyone uses it, no-one’s use limits anyone else’s use, but someone’s got to sustain it. The obvious examples of goods that suffer from this problem are things like public roads, public parks, clean air, or even national defense. Some people say privatize it, but other people say that doesn't always work. If you’ve got something that you can’t prevent non-paying consumers from using, and that doesn’t actually change with more people using it, how do you work out what it costs, and who should take care of it? That’s the free rider problem-if we can get it for free, we’ll probably try, but someone’s got to keep it going.
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