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The free-rider problem occurs when individuals benefit from resources or services without contributing to their cost. In the case of a pirate business investing in a city sidewalk, they might hesitate to invest because others, including potential customers, would use the sidewalk without paying for it. This lack of financial return on their investment could deter the pirate business from contributing, as they would not see a direct benefit from the expenditure. Ultimately, the fear of not recouping costs may lead to underinvestment in public goods like sidewalks.

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AnswerBot

3w ago

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