Friday, April 27, 2007

Coase and the Curfew

Cleveland kids may be fighting the law a bit more this summer. The city is enacting a new, earlier, curfew for young teens. Apparently, with so much time on their hands, they are running around making noise and driving some citizens crazy.

Time for a lesson from Ronald Coase. As he noted, it is not, say, sparks from a railroad that are the problem but those sparks in the presence of a wheat field (which cause nasty fires). Similarly, it is not kids who are out are night, or even loud kids out at night, but loud kids in the presence of people trying to sleep. The problems that occur when both are present should not be solved by denying kids the right to be out at night (or banning railroads).

A better solution would be a fine (even better would be that fine then paid to the harmed parties). Noise complaints would followed up by an officer not just breaking up the offenders but issuing a ticket. I guarantee there will be fewer noise problems without punishing those who just want to stargaze.


jeremy h. said...

A) There already is a fine ($250).

B) I think the concern is more than "noise," but extends to criminal activity. Yes, there are penalties for these crimes already, but this is a preemptive attempt to stop said crimes. Curfews are not always unlibertarian (see Klein).

jeremy h. said...

Also, I believe the solution you have proposed is Pigouvian, not Coasian.

David said...

No, theres a fine for merely being out at night, not for making noise.

It's technically more Pigou, unless the money is sent to those that complained (which I know isn't quite Coase because the expression of subjective values create optimality, but transaction costs are especially high here). However, the notion was inspired by Coase (railroads and sparks). Besides, "Pigou and the Curfew" doesn't have quite the same ring to it.

jeremy h. said...

A) You're right about the fine, but I would suspect there is a high correlation between kids out late and kids being noisy. Your hypothetical stargazer is in the minority. And the article you link to says nothing about "noisy" kids, but rather "unruly" (i.e. commiting crimes).

The community collectively owns the streets, and decision-making is carried out through their elected representatives. As public choice economists, we know this is filled with problems. However, threatening a blanket fine may be cost efficient, when compared to 1) the crimes prevented and 2) the additional law enforcement to assess fines under your "Coasian" world.

B) Pigou also used the example of railroads and sparks, long before Coase. Coase's "revolution" was to throw his hands in the air as to who had the property right, and let a social planner decide.