Ronald Coase, The Problem of Social Cost, Journal of Law & Economics, 1960
Robert Frank on Coase's views on how to respond to climate change. (Coase turned 100 in 2010!). New York Times, Jan. 10, 2010
A delightful application of the Coase Theorem.
Shouldn't the Coase Theorem deal with stuff like river rafting and prospecting?
A fun example: Property Rights and Botticelli's Solution to the Problem of Social Cost
Another time a cloth‐weaver came to live in a house next to Sandro's, and erected no fewer than eight looms, which, when at work, not only deafened poor Sandro with the noise of the treadles and the movement of the frames, but shook his whole house, the walls of which were no stronger than they should be, so that what with the one thing and the other he could not work or even stay home. Time after time he besought his neighbor to put an end to this annoyance, but the other said that he both would and could do what he pleased in his own house; whereupon Sandro, in disdain, balanced on the top of his own wall, which was higher than his neighbor's and not very strong, an enormous stone, more than enough to fill a wagon, which threatened to fall at the slightest shaking of the wall and to shatter the roof, ceilings, webs, and looms of his neighbor, who, terrified by this danger, ran to Sandro, but was answered in his very own words—namely, that he both could and would do whatever he pleased in his own house. Nor could he get any other answer out of him, so that he was forced to come to a reasonable agreement and to be a good neighbor to Sandro.
[Giorgio Vasari, The Lives of the Most Excellent Painters, Sculptors, and Architects, trans. Gaston du C. de Vere (New York: Modern Library, 2006), pp. 192–93]
From the back cover of the Journal of Political Economy, June 2009
For interest:
Smells like bacon! (London Daily Mail, October 21, 2010)