# Free riding `kaal:entity:free-riding` **Status.** derived This node is assembled mechanically from the 7 claims that carry the concept tag `free-riding`. It is a roster of what the corpus says under this term. It is **not** an adjudicated definition: no single statement here has been ruled canonical, and no first-appearance call has been made. Read the claims and judge for yourself. ## Every claim under this term 7 claims across 6 works, 2011 to 2026. **2011** - [1806252-014](https://wulfkaal.github.io/claims/1806252-014) [failure/argued] *(failure mode)* -- Systemic risk and financial market stability are public goods, so individual banks free ride on other banks' hedge fund credit risk management and are not incentivized to adequately monitor or limit their own hedge fund risk exposure. > Systemic risk and financial market stability generate public good and free-rider problems: banks are not incentivized to adequately monitor or limit hedge fund risk exposure because of their reliance on hedge fund credit risk management by other banks. Kaal, Hedge Fund Regulation Via Basel III (2011). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1806252 **2021** - [3782203-037](https://wulfkaal.github.io/claims/3782203-037) [mechanism/argued] -- Automating exclusion of cheaters through smart contracts makes punishment credible and removes the infinite regress of traditional enforcement, where members would have to police those who failed to police those who failed to police cheaters. > Algorithms can be written which exclude members who cheat from hav- ing access to their market. Punishment for cheating becomes automated and there- fore credible. Free riding in policing can at least partly be eliminated by automation. Craig Calcaterra, Wulf A. Kaal, A Technical Perspective on Decentralization (2021). SSRN: https://ssrn.com/abstract=3782203 - [3799320-037](https://wulfkaal.github.io/claims/3799320-037) [mechanism/argued] -- In the DAO of DAOs, algorithms can exclude cheating members from market access, so punishment becomes automated and therefore credible, and free riding in policing is at least partially eliminated by automation. > By contrast, in the DAO of DAOs, algorithms can be written which exclude DAO of DAOs members who cheat from having access to their market. Punishment for cheating becomes automated and therefore credible. Free riding in policing can at least partially be eliminated by automation. Wulf A. Kaal, A Decentralized Autonomous Organization (DAO) of DAOs (2021). SSRN: https://ssrn.com/abstract=3799320 - [3808859-027](https://wulfkaal.github.io/claims/3808859-027) [failure/argued] *(failure mode)* -- Meritocratic allocation of power in open source projects is often a fallacy, because rank can reflect timing and one-off contributions, deflation is not built into the perception of merit, and free riding on past reputation is therefore possible. > In other words, deflation is not built into the perception of merit and free riding is possible. Wulf A. Kaal, Decentralization – Why We Need Technology Infrastructure Upgrades (2021). SSRN: https://ssrn.com/abstract=3808859 - [3949098-020](https://wulfkaal.github.io/claims/3949098-020) [failure/argued] *(failure mode)* -- In traditional underwriting, investors who cannot distinguish underwriters by reputation create free riding: once free riding occurs, underwriters stop investing in screening and try to free ride on others, producing a lemons problem. > As a result, free-riding on other's reputation may occur. Once free riding occurs, traditional underwriters will likely stop investing in their screening and instead attempt to free ride on others. This creates what is known as a lemons problem in the law and economics literature. Wulf A. Kaal, Reputation as Capital – How DAOs Upgrade Finance (2021). SSRN: https://ssrn.com/abstract=3949098 **2026** - [6269518-016](https://wulfkaal.github.io/claims/6269518-016) [failure/argued] *(failure mode)* -- Because policing protocol deviants is expensive, it is individually more efficient to assume others comply and skip policing, which yields a subgame perfect Nash equilibrium in which eventually fewer than half of members police and the system can be gamed. > This gives a subgame perfect Nash equilibrium leading to a situation where eventually less than 50% of the members actually perform the policing, meaning the system can be gamed. Wulf A. Kaal, Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance (2026). SSRN: https://ssrn.com/abstract=6269518 - [6269518-035](https://wulfkaal.github.io/claims/6269518-035) [failure/argued] *(failure mode)* -- A system that permits strategic under-citation effectively transfers value from genuine contributors to free-riders and thereby violates the equity norm of DAO governance. > A system that permits strategic under-citation effectively transfers value from genuine contributors to free-riders, violating the equity norm. Wulf A. Kaal, Citation Honesty Mechanisms in Weighted Directed Acyclic Graph Governance (2026). SSRN: https://ssrn.com/abstract=6269518 ## Verify Every claim above resolves to a record carrying a verbatim source quote, the sha256 of the source PDF, and a preformatted citation. Nothing here asks to be taken on trust. curl -s https://wulfkaal.github.io/entities/free-riding.md | sha256sum **Canonical form.** This markdown file is the canonical hashed representation of this entity node. Its sha256 is the content hash.