Is social security an externality?

Location: In Pulsinelli's Class

Sources used by Pulsinelli today:

Coase - "The Lighthouse in Economics," from the Journal of Law and Economics; October 1974 pp 357-76

Cheung - "The Fable of the Bees: an Economic Investigation," from the Journal of Law and Economics, vol. 16; 1973 pp 11-33

B.L. Bensen - "Are Public Goods 'Really Common Pools?'," from Economic Inquiry, vol. 32; April 1994

D.B. Klein - "The Voluntary Provision of Public Goods? The Turnpike Companies of Early America," from Economic Inquiry, vol. 28; 1990 pp 788-812

D.B. Klein and C. Yin, "Use, Esteem, and Profit in Voluntary Provision: Toll Roads in California, 1850-1902," from Economic Inquiry, Vol. 34, 1996

S.R. Rhinehart + Pompe, "Entrepreneurship and Coastal Resource Management," from The Independent Review, vol. 1, Spring 1997, pp 543-590

B. Vandle, "Environmental Turning Points, Institutions, and the Race to the Top," from The Independent Review, Vol. 9 (Fall), pp 211-260

T. C. Anderson and P.S. Hill, "The Not So Wild, Wild West: Property Rights on the Frontier," from Stanford University Press, 2004



3. Communal ownership of property is okay if there are zero transactions costs
Coase's contribution to economics has to do with transaction costs like: discovering with whom they must deal,
Value to factory owner being 18,000 per year
value to residents is 10,000/year
transactions costs = 9,000/year

If the court rules the factory isn't liable, the factory owner will pollute.
if the court rules the factory is liable, the factory owner won't pollute (transaction costs already too high), and they don't have the ability to pay any further worth.

if transactions costs are efficient or low, an efficient choice independent of property rights is found. Under that arrangement, an efficient resource use results from bargaining regardless of legal assignment of property rights.

If transaction costs are not low, an efficient choice is harder to come by, unless the legal right is given to the more efficient being in the first place. Or....
if transaction costs are high, then an inefficient solution is possible if property rights are assigned incorrectly

Assignment of property rights lead to "wealth effects" - which could lead to a different output quantity (and therefore a different amount of pollution) than what is optimal.

New Direction

I don't have the ability to sustain my fiction writing - I just get caught up and distracted by too much. From this point out, I think I'm going to see about renaming the blog and making it a sort of "blog o everything." Subjects I'm interested in (and presented in no particular order) are:

Short stories (because they end)
Gaming
Cooking
Christianity
Forensics/Debate
Beer
Marriage
News events

Teaser Paragraph

Daedalus's shadow sealed away the final radiant burst of sol's rays as the U.H.V. Orator exposed its cameras to the station on its approach. Daedalus dwarfed the small vessel, appearing an ancient and indomitable titan, granting shelter to the Orator and the hundreds of thousands of ships like it. From this distance, little of Daedalus's features were noticeable, but its gargantuan hexagonal layout was impossible to miss. Two hundred thousand miles ahead of the Orator, a small docking port was preparing to receive the Orator as a guest.


Captain Snowe stood near the seat of the ship's internal controls. As captain, he was indisposable, but at this stage of the ship's approach, it was best to let each crew member do their duty without intervention. Nevertheless, the trip from Luna to Daedalus was four months, and he wanted to keep an eye on the crew to be sure that overeagerness prevented simple mistakes. He didn't fear the tremendous forces at play in his ship's docking approach, nor did he fear the explosive fusion reaction a mere two million miles from his ship. He feared that which was not feared: a faster-than-normal approach, a small overextension of the docking pads, or a hasty cargo connection with the station. Everything ought to go by the book if his crew knew that he was watching them. As Snowe turned to face his own imaging screen, he heard a small click in his right ear - a sign that the bridge staff was receiving a transmission from the dock.

"Orator, this is D.J.A. 5-10, confirming request for docking. We expect a solar flare in the next three hours. Request slow approach and halt at forty miles." Snowe did not reply. The Orator's own sensors had predicted a flare building on the approach, and the crew was already taking matters carefully. Moreover, the appropriate comm was in the rear bridge, where he had left his first officer in charge.
"D.J.A. 5-10, this is Orator, confirming approach request. Thank you for the update, we'll see you at forty miles." Snowe heard the transmission from his own ship. He laughed at the propriety afforded the station by Baroe, the officer. They owed no such thanks, but it certainly didn't hurt to stroke the ego of their hosts. Snowe turned to watch the approach, which continued as expected. They were now within one hundred and fifty thousand miles of the station and closing the distance, albeit slowly. It would be four hours before they finalized the docking sequence.