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9 - Non-welfarism in the Early Debates over the Coase Theorem

The Case of Environmental Economics*

from Part II - Developing Modern Welfare Economics

Published online by Cambridge University Press:  04 March 2021

By
Steven G. Medema
Edited by
Roger E. Backhouse ,
Antoinette Baujard  and
Tamotsu Nishizawa
Roger E. Backhouse
Affiliation:
University of Birmingham and Erasmus University Rotterdam
Antoinette Baujard
Affiliation:
Université de Lyon et Université Jean Monnet à Saint-Étienne
Tamotsu Nishizawa
Affiliation:
Teikyo University Japan
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Summary

Though economists typically eschewed non-welfarist arguments in the post-WWII period, there is at least one prominent instance in which such arguments were very much in play, both directly and as underpinnings for welfare-related arguments: The debate over the Coase theorem. This debate saw the Coase theorem regularly challenged on both welfarist (efficiency) and non-welfarist grounds. This then raises the question of what it was about the Coase theorem that led economists into this non-welfarist territory. This essay revisits the early debates over the Coase theorem, where non-welfarist arguments featured prominently, in order to bring out the nature of those arguments and attempt to understand the rationale(s) for their deployment. As we shall see, this move was a function of forces internal and external to economics, including the environmental turn in society and the profession, a concern with issues of fairness and equity in the evaluation of how to resolve externality problems, and a view, prominent in certain quarters, that the environment and environmental preservation is an end in itself.

Keywords

Environmental economicsexternalitiespollutionCoase theoremefficiencywelfarenon-welfarismfairnessPigou
Type
Chapter
Information
Welfare Theory, Public Action, and Ethical Values
Revisiting the History of Welfare Economics
 , pp. 208 - 231
Publisher: Cambridge University Press
Print publication year: 2021

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