by Richard Epstein
September 12, 2013
The recent death of Ronald Coase has given rise to an outpouring of praise. He never proselytized like Milton Friedman, but was an understated and consistent critic of big government. How does Coase’s logic apply to environmental issues? It offers strong legal protection through both damages and injunctions against pollution that invades land, air, and/or water, both public and private. Those invasions can often be controlled by private lawsuits for major injuries concentrated in a few individuals. The takeaway from this discussion is that much of the serious environmental debate does not choose between markets and regulation. Rather, it asks what kinds of government regulations are likely to produce the right social results. Sometimes condemnation is superior to direct regulation. Sometimes it is not. Coase was right to be leery of adventurous regulatory programs that can misfire.