Coase on a Plane, or, an Idea, Recycled
I agree with co-blogger Bryan that most voters are rationally irrational. My sense is that there are also a lot of voters and people in positions of influence who know just enough economics to be dangerous. As Steve Horwitz and I pointed out in a recent essay for the Library of Economics and Liberty, “market failure” is where the conversation begins, not where it ends.
A couple of hours ago, I got off a flight where I was seated near a couple of very, very loud children: before we departed, a few of my fellow passengers were craning their necks and looking for the source of the disturbance and–I hope–pitying the mother. This brings me back to a set of questions I’ve always wanted to ask on an exam or to a job candidate. From a 2009 post on Division of Labour:
Crying babies and loud children are among the common complaints of frequent flyers; indeed, I can say from personal experience that a screaming infant can make for a long flight. Describe the reciprocal nature of the externality. How does the private market internalize the externality? To what extent does the possibility of an upgrade to first class help mitigate the externality? What is the role of reasonable expectations in deciding on a policy? What is the parent’s responsibility? What is the responsibility of the other flyers?