Art Carden  

Coase on a Plane, Cont'd: How Loud Kids on Planes Are and Aren't Like Factories

Shorting Housing... John Allison's Nice Summary...

There were, once again, some truly excellent comments on my last post, in which I offered my answers to the questions blockquoted below. Furthermore, Jeanne Hoffman at Heels First Travel--a lawyer by training and a member of the IHS staff--also picked it up and offered comments.

Crying babies and loud children are among the common complaints of frequent flyers; indeed, I can say from personal experience that a screaming infant can make for a long flight. Describe the reciprocal nature of the externality. How does the private market internalize the externality? To what extent does the possibility of an upgrade to first class help mitigate the externality? What is the role of reasonable expectations in deciding on a policy? What is the parent's responsibility? What is the responsibility of the other flyers?

Andrew asked (clipped):

Just out of curiosity, is it possible to explain away any possible externality in the above fashion?

For instance, switch out a baby crying on a plane for a factory polluting the local water supply.

Daublin offered the following (also clipped):

Here is an attempt to show why the crying baby is indeed an externality. Suppose instead of a crying baby, the sound was from an accordion player. One of the passengers on the plane paid the person beside them $100 to play some accordion music during the flight. Everyone else on the plane has bleeding ears.

Is the accordion music [sic] an externality? I would think obviously so. So why not the infant?

There were several other great comments. Just because there appears to be a spillover doesn't mean the other passengers are entitled to relief. Perhaps I should have been more specific--perhaps I should've asked whether other passengers are entitled to relief because of kid-related noise. That said, here's how loud kids on planes are and aren't like dirty factories and onboard accordion players.

Consider the factory example first. To change the example to one I use in class, suppose Bart and Lisa go to the Ol' Fishin' Hole and catch a three-eyed fish. They look up and see Mr. Burns' nuclear power plant on the shores of the fishin' hole. Are they entitled to relief?

I think the answer depends on who was there first. If it was Mr. Burns, then he homesteaded the right to use the Fishin' Hole, Bart and Lisa "came to the nuisance," to use the lingo for these kinds of examples, and Bart and Lisa are not entitled to relief. If it was Bart and Lisa, then Mr. Burns has violated their established right to use the Fishin' Hole and Bart and Lisa are entitled to relief. Murray Rothbard's article "Law, Property Rights, and Air Pollution" is fantastic on these issues. In the case of Burns v. Bart & Lisa, the court's job would be to determine who has the right to the Fishin' Hole.

Now consider the accordion player. This is interesting because the airline owns the shared space within the plane and can therefore decide on its own policy. It's probably reasonable to expect a few kids on a plane and, therefore, a little bit of kid-related noise. Accordion-playing, on the other hand, is sufficiently out of the ordinary (and sufficiently disruptive) that most airlines will (politely) ask accordion-players to stow their instruments beneath the seat in front of them or in the overhead compartment.

If demand is sufficient, of course, there might be a market for accordion-friendly and accordion-free airlines--or at least accordion-playing and non-accordion-playing sections with soundproof glass between them. I'll let Carol Burnett, Harvey Korman, and Tim Conway explain further:

COMMENTS (9 to date)
Sol writes:

Live in-flight music. Personally, I'd be happy to pay extra for a plane with those guys playing on it.

Jim Rose writes:

Barzel wrote about the costs and benefits of leaving some attributes of property but not others as common property and even returning private property back to a common property status.

In some cases, the quite enjoyment of your property is not private property such as in areas such as planes and fast food outlets but more the case in expensive restaurants.

This is evolving: more of the up-market restaurants are returning quite enjoyment of your meal to common property because power couples now expect to be able to bring their young children with them.

Expensive restaurants developed separate children’s menus with smaller serves and plain food for those children who have narrow food preferences.

david writes:

Externalities are created by ownership rights. If the ownership boundaries happen to line up with the Coasean bargaining equilibrium, then there are no externalities. This is by and large a product of politics and tradition.

You correctly identify this when you realize that the boundaries are created through "reasonability" of the conduct of passengers. But then you've disregarded that people may violently disagree on what constitutes reasonable behaviour. Airplanes are a space where people from many different cultures may interact, for obvious reasons.

Rothbard's own solutions to the problem of delimitation never struck me as appealing, either.

Ken P writes:

I always feel sorry for the crying babies on the plane. I bet to them, the cramped space, and popping ears are externalities.

Alex Godofsky writes:

The entire point of Coase is that who "gets relief" is just a function of how the property rights are defined.

ajb writes:

One can't discuss Coase without thinking about the regulatory environment that the airlines exist in. Just imagine that an airline would be profitable by banning babies and fat people? [Assume the premise of profitability.] Odds of their getting sued are enormously high.

Or consider how airlines are constrained in their use of flight attendants. Imagine firing those who offer indifferent service and aren't strong enough to lift luggage into the overhead compartments (the latter is a real issue because some foreign airlines have more stringent strength requirements than this).

So in a world where you cannnot observe the first best Coasian outcome due to regulatory uncertainty, you get fights over which rights are "correct." That includes rudeness from fellow passengers.

Jim Rose writes:

One of the many social insights of the autobiography of the Friedmans was the snobbishness of well-to-do travellers.

Milton Friedman travelled the world more than most in the 1950s and 1960s because it was at the invitation of ex-students from under-developed countries

They were able seeing the great sights of the world before international travel became cheap after the introduction of the jumbo jet in 1972.

The petit bourgeoisies were rather put off at having to share their planes and travel experiences with the hoi-polloi, then backpackers, and after the 1980s, working class families – the immiserised proletariat started to take cheap overseas holidays with their young children.

Jay writes:

Airlines are already taking steps to solve this issue:

"The controversial new policy bans children under 12 years old from a Quiet Zone, demarcated as the first seven rows of economy. Located immediately behind the premium seating section, the zone also has softer lighting – designed to provide a more relaxing atmosphere – and is sectioned off from the rest of the plane by curtains and bathrooms. A spot in this section will cost passengers an additional 35 to 110 Malaysian ringgit."

Daublin writes:

It smells funny to do a legal analysis to answer an economic question. From an economic point of view, surely there is no difference between an airline passing Quiet Zone rules, and a government passing a rule against burning leaves on the street.

The important thing is the pattern of rights. If very different laws give rise to the same pattern of ownership and decision making in two different cases, then the economics should play out the same way.

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