Free Ridership

Free-loaders are a common part of life. They are that “friend” who promises to pitch in for gas, buy the next round or contribute in some way, but never does. It’s the person who shows up at the potluck but doesn’t bring the casserole made with mushroom soup. These people exist everywhere and can present a major problem to larger scale programs and organizations. Their behavior is commonly referred to as ‘free ridership.’ Free ridership happens when a person benefits from the hard work of other people or groups without contributing (time, money, etc.) themselves.

For example, most business associations use member dues to support political lobbying efforts. Since political lobbying benefits everyone in an industry (members and nonmembers), some businesses may choose to not become members. This is an economically rational response. After all, why would anyone pay for something they can have for free? The problem is that if every business adopts this line of thinking, the association would receive zero funding and could no longer lobby. Therefore, even if free riding benefits the individual in the short-term, everyone suffers in the long-term.

Governments solve this problem by charging fees and levying taxes. Requiring everyone to pay a tax guarantees funding for items like public roads, parks and safety.

Unions use a similar strategy. Through the fair-share process, they require nonunion members to pay fair share dues to the union. These organizations argue that since nonunion members still benefit from collective bargaining, contracts or grievance representation, nonmembers should also contribute to the union.

So, what can be done to solve this problem for your business or membership organization? After all, it will be quite the challenge to encourage people to pay for something they could have for free.

A more realistic solution is to offer more exclusive benefits to paying members. These benefits could include discounts, information, networking opportunities or training. For example, AARP or NFIB both provide advocacy that benefits everyone they represent. They provide members with news updates, travel deals, insurance and retail discounts. Since these benefits can only be received by members, non-members may be incentivized to join.

Ignoring the free riding members within your organization (i.e., members who pay dues but don’t really contribute) is not only costly but can discourage strong contributors.  Show the team how active contributors are valued. If appropriate, managers could also meet with inactive team members to discover why they might be disengaged.

By recognizing and acting to reduce free riding, managers and association leaders can achieve their goals. Remember, if no one brings a dish to the potluck, you go hungry.

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