Two comments yesterday from "quincunx" deserve attention up front. First, on Tim's smoking post:
Marcia - you are making too much sense here, this isn't the site for sense making.
There is no economics here - since there is no economics without private property.
This is environmentalist propaganda masquerading as economics.
Um, can I disagree and leave it at that? Actually, there are no "trades" without private property. The field of economics is broader than the study of pure trade.
And, I think, this is the first time we've been accused of being environmentalists (at least Tim).
More substantively ...
Second, on Stavins' myth of market solutions post:
The assumption is made that there is such a thing as "public goods". The fact that the government is the sole monopoly currently providing these goods is not a good enough reason for it to do so. I think you should do a little bit of research on how environmental issues were handled in the US before 1840. The key to making markets function is property rights. I know this may seem like a strange concept to an 'environmental economist' but if you can just rid yourself of only criticizing other bad economist, and look back in history you would see that protection in environment can only occur with private property rights in environmental resources. The reason the US abandoned protecting the environment was a deliberate policy to build up industry to compete with Britain. All that is needed is to get rid of all government land, transfer it to the private sphere, and enforce the externalities, which in a property rights regime is tantamount to crime. The only pollution remaining is pareto optimal. That is a market will form wherein garbage and pollution will be purchased by A) those who want to charge storage fee. B) those who want do A as well as recycle. Secondly one should eliminate SOCIALIZED waste collection, for it is the biggest factor in creating waste. This is government problem, not a market one. If people had to actually pay directly for the cost of removing waste, they would more likely use more environment friendly substances and/or more careful with the amount of waste they produce. There is no MARKET problem in the environment. There is a government problem.
I don't mind the free-market environmentalism (i.e., property rights) perspective when it works, but what about the Coasian achilles heel: transactions costs. The classic problem is air quality. If a firm pollutes the air and thousands of households are negatively affected, it is difficult for the thousands to come together and form one side of the market. Case closed?
P.S. an 'environmental economist' wondered: what is a 'quincunx'? From Wikipedia:
A quincunx is the arrangement of five units in the pattern corresponding to the five-spot on dice, playing cards, or dominoes. The quincunx is named after the Roman coin of the same name, which was symbolized by a quincunx of dots.
