What Coase Might Say to Zoning Boards

The Coase Theorem, which tells us that the social optimum may be reached by exchange no matter how property rights are assigned if transaction costs are zero (and not if transaction costs are high enough), has relevance to the problem of zoning. In much of the U.S., zoning is excessively strict, pricing moderate-income households into … Continue reading What Coase Might Say to Zoning Boards

Light Pollution. Part I: Compensation?

Light pollution which brightens the beautiful dark sky with an ugly muted glow is one of the most underrated negative externalities around.  I talked a little bit about this earlier.  Unfortunately, it is a really difficult problem to solve.  On the one hand, Coasian bargaining can't solve the problem given the huge transaction costs of dealing … Continue reading Light Pollution. Part I: Compensation?

Sunday Morning Quotation – Ronald Coase on Laissez-Faire vs. the Ideal

Nobel laureate in economics Ronald Coase in "The Problem of Social Cost": Actually very little analysis is required to show that an ideal world is better than a state of laissez faire, unless the definitions of a state of laissez faire and an ideal world happen to be the same. But the whole discussion is … Continue reading Sunday Morning Quotation – Ronald Coase on Laissez-Faire vs. the Ideal