Recent interview With Nobel Prize-winning economist Tyler Cohen Joseph Stiglitz He stated that he was opposed to deregulation of housing regulations.
One person’s freedom is another person’s unfreedom. That is, what I can do… I talk about freedom, what someone can do, what his opportunities are, what his choices are. And when one person exerts their freedom and it has externalities on another person, that person Constrain It’s the freedom of others. If you are free to build buildings, for example, if there is no zoning, you can build as tall a building as you want. The problem is that a tall building blocks the light of other buildings. It might make noise.
Stiglitz is certainly right that increased construction creates negative externalities, but he is wrong to claim that this solves the problem.
First, increased construction positive The external effects are likely to outweigh the negative effects. Increasing housing supply makes it easier for workers to move to better jobs, spurring economic growth.And more densely populated cities reduce the need for cars, which in turn reduces carbon emissions.
However, another reply to Stiglitz sheds light on a point that is often overlooked in the discussion of negative externalities. right Create them.
Let’s look at a simple example inspired by philosopher Robert Nozick: Carl proposes marriage to the love of his life, Alice. While Alice is pondering, Bob proposes and Alice accepts. What matters is that Alice right Without Bob’s proposal, Carl would have accepted it, and so Carl will be lonely and miserable for the rest of his life because of Bob. Bob’s proposal to Alice creates a significant negative externality. In fact, the damage suffered by Carl is much greater than the damage suffered by the people whose views are blocked by the newly built tall building.
Nevertheless, Bob has the right to marry Alice, even if doing so would cause Carl harm. In other words, Bob has the right to propose marriage, and Alice has the right to accept it. Furthermore, Carl do not have Carl has a right that Alice accept his marriage proposal, so although the outcome is unfortunate for Carl, he has no basis to interfere because no one’s rights have been violated.
Similarly, the mere fact that a new high-rise building will make life worse for residents is no reason to block its construction. To resolve that question, it is necessary to sort out the relevant rights claims. Assuming that the land used to build a high-rise building was duly acquired, its construction is at least presumptively permissible. The developer has the right to use his land as he sees fit, including using it to build a high-rise building.
of course not all You are allowed to do whatever you want with your property. You can’t hit the opposing pitcher in the knee with a baseball bat, but that’s because the pitcher has autonomy over his body and the right to prevent being hit in the knee.
Is there a similar right to override the developer’s rights in construction cases? Property RightsI’m skeptical. At first glance, something like a right to unobstructed views of desirable landscapes seems like the best candidate. Unfortunately for opponents of housing deregulation, this kind of right simply doesn’t seem possible.
To see why, suppose you like the view of my hair. Suddenly, I decide to put on a hat. I’ve blocked the view you wanted, but obviously you have no right to stop me from doing so. At the very least, the idea that you have a right to an unobstructed view needs to be refined a bit.
Perhaps this idea could be salvaged by restricting it to cases of severe harm. Perhaps the harm you suffer from having your view of the sunset obscured is greater than the harm I suffer from having my view of my hair obscured. But the severity of a negative externality is not enough to show that someone has no right to impose it. The harm Carl suffers as a result of Bob’s marriage proposal is greater than the harm Carl suffers as a result of the new high-rise. It seems possible that Bob might build a high-rise near Carl because he might propose to Alice. After all, it would be odd to allow Bob to impose a more harmful negative externality (a lonely and miserable life for Carl) while not imposing a less harmful negative externality (obscured views of the sunset for Carl). Or imagine that Carl runs a small bookstore and Bob moves next door to a Barnes and Noble. Bob might put Carl’s store out of business, but Bob is still allowed to do so. A broader perspective is that actors may be free to act even if their actions produce negative externalities: the existence of a negative externality at best starts a conversation, but does not end it.
Christopher Freiman is a general business professor in the John Chambers School of Business and Economics at West Virginia University.
