Tuesday, January 15, 2013

A Question of Morality or Coasean Social Cost?

Ronald Coase has sometimes been criticized for treating all problems as economic, when some are plainly moral. (See, e.g., here). I don't think those arguments are fair to the extent that Coase is an economist, not a philosopher, purporting to explain the economics of (successful or failed) transacting, not whether certain activities or transactions are morally right or wrong. Moreover, the notion that murder is morally wrong is not inconsistent with the Coasean presumption that murderers are virtually always the lower-cost avoiders of the harm resulting from their interactions with victims.

All this came to mind this morning, as I was leafing through the Stanford alumni magazine, reading a profile of recent Nobel laureate (in economics) Alvin Roth. The article addresses Roth's fascination with what he calls "repugnant transactions," and references the following case: France has banned, apparently on moral grounds, the "sport" of "dwarf-tossing." According to Roth, a dwarf unsuccessfully challenged the ban before the UN Human Rights Committee, claiming that it infringed his human rights by restricting his employment (see here).

Whatever one thinks of dwarf-tossing as an activity, I have to think Coase would enjoy reading about the case, which exemplifies how even apparently clear moral issues can also be joint- or social-cost problems. No doubt, Harvard philosopher Michael Sandel would find this appalling (see here), which is fine by me.

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