PSCI255 Final: Discussion &Review 3

• School: University of Waterloo
• Department: Political Science
• Course: PSCI255
• Professor: Jingjing Huo

Document Summary

Rational fool & free riding it"s (cid:373)ore ratio(cid:374)al to free ride, a(cid:374)d (cid:374)ot (cid:272)o(cid:374)tri(cid:271)ute, while still reaping the benefits. Reducing free riding can be done by reducing the total number of total (cid:272)o(cid:374)tri(cid:271)utors therefore (cid:373)aki(cid:374)g a(cid:374) i(cid:374)di(cid:448)idual"s free ridi(cid:374)g (cid:373)ore (cid:272)ostl(cid:455) If collective action is needed, but access to the outcome can be denied to those not contributing, it is not considered collective action failure. E. g. working in a large team environment: not showing up for work, or not working as hard will still result in a finished product, but you may get fired. In a highly centralized economy, free riding becomes impossible because each contribution is much more significant to the total outcome this results in wage restraint: wage bargaining can be centralized or decentralized. Centralized bargaining: one main player (scandinavian countries) in one bargaining round, union is unable to free ride, resulting in a lower wage and higher wage restraint, this leads to low levels of unemployment.