Regarding free books. You may give free books to people who do not have money but who show a healthy interest in having the book. While distributing books devotees must use their own good intelligence to decide to whom they should give a free book and to whom they shouldn't. The devotee should decide -- based on his or her own best judgment -- whether giving a free book to someone will be favorable or not. If someone is envious, we will not give him a book because he may misuse or abuse it.
Other people, who are favorable, but who cannot pay at the time, will benefit greatly if we let them have it for free. Look for their qualification based on their interest or sincerity.
Also, if giving a free book to a certain person will create good will or a favorable impression, don't hesitate. Presenting a free book to a head of state, to a famous or influential person, or to someone you see regularly, for example might also be very favorable.
If we give free books without any discrimination at all, people may not understand their great value and may not appreciate or read them. When people give something for the book they become more inclined to read it because they have given their hard-earned money for it.
Also, when they donate their hard-earned money, they gain ajnata sukriti, qualifying them to read and better understand the contents of the book. Srila Prabhupada told the story of a boy who went door-to-door with first-class mangoes, trying to give out for free. People rejected the free mangoes thinking that they must be defective. Then the boy changed his tactic, charging a high price for each of the high-quality mangoes. With this, he sold many kilos of mangoes because the recipients thought, "From the high price, I can understand that these are very valuable mangoes."
Sometimes at events, like ratha yatra or during Hari Nama Sankirtana, large numbers of people see the Lord in His chariot or hear the chanting of the holy names and become instantly purified. Such people who have been touched by the spiritual vibration become curious to know what we are doing. In these circumstances, it is also Okay to give out free small books or booklets to the people who are watching and appreciating the devotional event.
Even in these cases, however, we may also decide to invite people to give donations. If they feel encouraged to give something, it is even better for them.
Some devotees are developing programs to collect money from congregation and others interested in distribution of literatures. They then purchase books with this money and arrange to leave these subsidized books at hospitals and in shops where people will read them. If these programs are well thought out and well organized, they can also be beneficial and successful. However, such free book programs should never be seen as a substitute for or replacement of our book selling programs.
On the whole, Srila Prabhupada preferred (especially in wealthy nations like America) that we get payment for the books. But, he also did not make this a hard and fast rule. In general, therefore, devotees should be trained to have a bias towards giving mercy and leaving each person with a favorable impression, becoming Ambassadors of Goodwill. The implementation of this principle requires discrimination and spiritual insight gained through hearing and chanting in the association of pure devotees and the regular practice of distributing the holy names, Krsna prasadam and transcendental literatures.