For many tasks, the efforts of a single individual are sufficient to serve an entire group. One sentinel can alert an entire community. One group member can investigate and report on the honesty of a vendor or the usefulness of a consumer good. Thus we might expect clustering into groups to be advantageous. But as the epigraph from Aristotle suggests, there is a countervailing force. The returns to scale offered by larger groups are often offset by free-rider problems that grow with group size. This tension was explored by Mancur Olson , who argued that because of free-rider problems, large groups are less able to act in their common interest than small ones and thus in politics it is possible for a minority with concentrated interests to dominate an opposing majority of individuals, each of whom cares less intensely, even though total willingness-to-pay of the majority is higher than that of the minority. Here we explore the group free-rider problems observed by Aristotle and Olson and the relation between efficiency and group size.
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