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Saturday, November 05, 2011

Pigou... and My Mice

We have been thinking of shutting down our Pennsylvania home for the winter, to save on heat. But there is a problem.

Haven't the mice that live there moved in based on their having formed the expectation that I would continue to provide heat? Isn't my shutting down a negative externality for them? Perhaps the solution is to place a Pigouvian tax on me for shutting down, and employ the proceeds to help the mice relocate?

(The answer to these questions has larger ramifications: Bob Murphy also wants to tax me because of negative externalities I have created, and the mouse case probably would act as a precedent.)

3 comments:

  1. You're such a statist. Clearly you and the mice can reach a Pareto optimal agreement.

    ReplyDelete
  2. The most important factor in thinking about these questions is standing.

    ReplyDelete
  3. My mice were definitely standing in order to get those seeds down inside the toilet paper tube.

    ReplyDelete