Abstract
When multiple agents have an opportunity to invest in improving the common good, the free rider problem arises. Many businesses and policymakers grapple with these free rider problems arising from the common good. For instance, this problem arises when governments or individual firms decide how much to invest in the environment as the common good. The theoretical examination of the mathematical model in previous literature has shown a mild form of the free rider effect. In stark contrast, the article, “Game of Variable Contributions to the Common Good under Uncertainty,” shows that a simple game-theoretic model of investment in the common good can result in a severe form of the free rider effect, much akin to what happens in a game of chicken. The article also shows that if the players are asymmetric and the environment has randomness, the free rider effect can be mitigated.
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