Street Preachers: The Coasian Solution

February 6, 2004 | 6 comments
By

There has been quite a bit of discussion, some here and some on the LDS-law list, about street preachers and garment desecration. But it seems like everyone is missing the obvious question: What would Coase do?

A quick description for readers unfamiliar with economics: Ronald Coase famously suggested that apportionment of liability did not matter where parties could bargain (and where transaction costs were zero) because parties would arrive at the most efficient solution anyway through bargaining.

In the street preacher context, it doesn’t matter if preachers are allowed to use garments or not. If waving around a sacred garment is worth $1000 to a street preacher, and the knowledge that a preacher is not using garments is worth more than $100 to ten church members, then they can collect $1000 and bribe the preacher not to engage in defiling garments.

Of course, over the long run, that solution might not be a real equilibrium. For example, other street preachers might desire to enter the market. In fact, people could pose to be street preachers, and threaten to enter the market, solely to collect their $1000 payoff. Eventually the members would run out of money (or of willingness to spend it). If that is the end result, then perhaps the Coasian solution is not truly feasible. However, many street preachers may be financed by organizations. If those organizations exert some control over their preachers, then a Coasian solution might still be possible. (Overall, the problem is keeping new entrants out of the street preacher market).

Tags:

6 Responses to Street Preachers: The Coasian Solution

  1. Nate Oman on February 6, 2004 at 7:43 pm

    As you implicitly point out, one problem with Coases Theorem is that in addition to perfect information and zero transaction costs, it also assumes the absence of strategic information. At least, it assumes this absence if you return it to its original framework, namely to show the superiority of property rights to Pigovian taxation as a means of dealing with externality problems.

  2. clark goble on February 6, 2004 at 8:39 pm

    It also assumes rational actors.

    I suspect that a large number of the street preachers who are most objectionable have serious emotional and mental difficulties. i.e. that they may have set the value of yelling a Mormons so high that they wouldn’t act in a manner you’d consider rational.

  3. brayden on February 6, 2004 at 10:39 pm

    To be rational one doesn’t have to be sane. One can be insane and still meet ends in a rational way. It just may appear to everyone else that your ends (desires, preferences, goals, etc.) are undesirable.

  4. Adam Greenwood on February 7, 2004 at 10:21 am

    If they have a belief in heaven and hell (I presume they do) and if they further believe they are doing God’s work in taunting us with their attack on our holy things (I believe they do), then wouldn’t any sum of money not be worth the risk of eternal damnation? I would think it a grievous sin to let myself be bribed away from doing the Work.

    The Church, for instance, gave up polygamy because the costs became too high. What sum of money would the Feds have had to offer the Church to achieve a similar result? No sum would have sufficed.

  5. Nate Oman on February 7, 2004 at 10:34 am

    Kaimi: It seems that there is also a problem with your example. Simply bribing someone not to do something isn’t the same as a Coasian solution. You would need to have an actual property right. To use the classic polluting factory example, once the home owners have purchase the right to clean air, they needn’t purchase it again from the next factory that wants to pollute. Rather that factory must purchase the right from them. The point is that there is some right to exclude either clean or dirty air, depending on who owns the right. Thus, a Coasian solution to the street preacher problem would require that we create a property right in pre-Conference harrassment that the different parties can then bid on (or bargain over). The owner of the right would then be able to exclude all rivalrous uses, e.g. street preaching or unharrassed conference attendance.

    Of course, the public forum doctrine is designed to make precisely this kind of solution very difficult in certain circumstances…

  6. Hamond on December 21, 2004 at 5:31 pm

    eiophgaieo oeesk.