Externalities

It is common to posit a clear opposition between the values served by property systems and the value of the environment. To give the environment its due, this view holds, the role of private property needs to be limited. Support for this has been said to be found in Locke’s famous ‘enough and as good’ proviso. This article shows that this opposition is mistaken, and corrects the implied reading of Locke’s proviso. In reality, there is no opposition between property and (...) the environment. This is shown using Locke’s theory of appropriation, as well as the real-life case of instream water appropriation. (shrink)

Joseph Newhard (2017) argues that a libertarian anarchist society would be at a serious military disadvantage if it extended the nonaggression principle to include potential foreign invaders. He goes so far as to recommend cultivating the ability to launch a nuclear attack on foreign cities. In contrast, I argue that the free society would derive its strength from a total commitment to property rights and the protection of innocent life. Both theory and history suggest that a free society would be (...) capable of defending itself, and indeed that it would probably use other means to avoid military conflict altogether. (shrink)

This essay offers a standard by which to assess the feasibility of market anarchism. In anarchist thought, the concept of feasibility concerns both the ability and the willingness of private defense agencies to liberate their clients from state oppression. I argue that the emergence of a single stateless pocket of effective, privately-provided defense for a “reasonable” length of time is sufficient to affirm feasibility. I then consider the failure of private defense agencies to achieve even this standard. Furthermore, I identify (...) five possible explanations for the conspicuous absence of private defense agencies. These explanations are entrepreneurial, technological, or economic in nature, or result from a lack of consumer demand or a lack of incentive for violence specialists to refrain from aggression. Of these, only an economic deficiency renders anarchism intrinsically unworkable. (shrink)

In Escape from Leviathan, Jan Lester sets out a conception of liberty as absence of imposed cost which, he says, advances no moral claim and does not premise an assignm..

Contemporary food supply chains are generating externalities with high economic and social costs, notably in public health terms through the rise in diet-related non-communicable disease. The UK State is developing policy strategies to tackle these public health problems alongside intergovernmental responses. However, the governance of food supply chains is conducted by, and across, both private and public spheres and within a multilevel framework. The realities of contemporary food governance are that private interests are key drivers of food supply chains and (...) have institutionalized a great deal of standards-setting and quality, notably from their locations in the downstream and midstream sectors. The UK State is designing some downstream and some midstream interventions to ameliorate the public health impacts of current food consumption patterns in England. The UK State has not addressed upstream interventions towards public health diet at the primary food production and processing stages, although traditionally it has shaped agricultural policy. Within the realities of contemporary multilevel governance, the UK State must act within the contexts set by the international regimes of the Common Agricultural Policy and the World Trade Organization agreements, notably on agriculture. The potential for further upstream agricultural policy reform is considered as part of a wider policy approach to address the public health externalities issuing from contemporary food supply chains within this multilevel governance context. (shrink)

In this paper, we study the auction to allocate an indivisible good when each potential buyer has a private and independent valuation for the item and suffers a negative externality if a competitor acquires it. In that case, the outside option of each buyer is mechanism-dependent, which implies that participation is endogenous. As several works in the literature have shown, the optimal auction entails strong threats to induce full entry and maximal expected revenue. This results from the full commitment assumption, (...) which ensures that threats are credible. We show that absent credible threats, the entry process does not lead to full participation: the equilibrium entails screening of agents in the entry stage and a trade-off between reserve prices and entry fees. Besides, we discuss the conditions under which the impossibility to use threats does not prevent the seller from ensuring a minimal screening and reaching a high expected revenue. (shrink)

We study the one-seller/two-buyer bargaining problem with negative identity-dependent externalities with an alternating offer bargaining model in which new owners of the object have the opportunity of resale. We identify the generically unique subgame perfect equilibrium outcome. The resale opportunity increases the competition among the buyers and therefore benefits the seller. When competition between buyers is very fierce, the seller may prefer to respond to bids rather than to propose an offer herself: a first-mover disadvantage.

(1992). Cultural goods and their positive externalities. World Futures: Vol. 33, Culture and Development: European Experiences and Challenges A Special Research Report of the European Culture Impact Research Consortium (EUROCIRCON), pp. 181-187.

A standard assumption in the economics of law enforcement is that the probability of a violator being punished depends only on the resources devoted to enforcement. However, it is often true that the productivity of enforcement resources decreases with the number of violators. In this paper, an individual who violates the law provides a positive externality for other offenders because the probability of being punished decreases with the number of individuals violating the law. This externality explains the existence of correlation (...) between individuals' decisions to break a law. The model evaluates the implications when determining the socially optimal enforcement expenditure, focusing specifically on the case of neighborhood crime. In particular, using a parametrized functional form, I show that neighborhood externalities will enhance or impede enforcement, depending on the crime rate. (shrink)