The usual meaning of social costs we know is: there is a certain separation between social costs and personal costs. For example, if you throw garbage, you have to bear a certain cost, but if you throw garbage on the street, you The personal cost to oneself will be small, and the cost to society will be large. But this week's social cost issue is not discussed at this level.

Before the official lecture, Teacher Xue asked a few questions:

The answers to these questions are yes to most people, because they have the same meaning. Features: ** When one party hurts the other party, of course the injurer needs to compensate the injured person, and at the same time we must limit the harm caused by the injurer to the injured person. ** There is a famous saying in Greece: "Exercise your rights, but it should be bounded by not harming the rights of others."

However, when everyone agreed that this was the case, an economist named Ronald H. Coase had a different opinion.

For example, there are two adjacent hotels. The hotel on the left has a beautiful swimming pool; the hotel on the right is about to build a 14-story building on its own land. If this annex building is built, it will block the sunlight coming from the east. Without sunlight, a swimming pool will attract fewer guests and revenue will be affected. So, the hotel on the left went to the court to request that the hotel on the right be prohibited from building an annex building. From this example, the hotel with a swimming pool on the left will defend itself by saying that for the hotel on the right, you can build an annex building on your own land, but don’t build it so high that it blocks the sunlight I want. But the hotel on the right can also defend itself by saying, for the hotel on the left, if you want to enjoy the view by the swimming pool, then enjoy it, but don't stop me from building my own annex.

It can be seen from the sentence "Exercise your rights, but you should not harm the rights of others". People with different positions can make different defenses.

So Coase made a very important point: ** All harm is mutual. ** In our view, these cases are one party hurting the other, but Coase believes that this perspective is wrong, and should be seen as two parties competing for some scarce resources.

Another example, there are two adjacent pieces of land, the land on the left is growing wheat and the land on the right is raising cattle. At this time, if the cow breaks through the fence and runs to the wheat field to eat the wheat, from Coase's point of view, this is not that the cow is hurting the wheat, but that the cow and the wheat are competing for the same land. The two hotels mentioned above What they are fighting for is also the right to enjoy the sunshine. What the cement factory and the residents are fighting for is the air and so on.

After this explosive point of view came out, it was easy to know that many people would rush to criticize it. So in order to explain his point of view more clearly, Coase published "The Problem of Social Cost" in 1960. "(The Problem of Social Cost), but even so, it still cannot withstand the continued criticism.

Richard Epstein, a legal economist and professor at the University of Chicago Law School, summarized all these debates, assuming all the cases mentioned above:

For example, in the dispute between cows and wheat, brainstorm for a moment. Assume that cows and wheat both belong to the same owner. At this time, he will definitely say, cows must not eat wheat? Won't. Whether cattle can eat wheat depends on how much beef can be sold and how much wheat can be sold. If the price of wheat is high, then of course the cows cannot eat wheat freely; but if the price of beef is high enough, then of course the cows can eat wheat. Not only do they eat wheat, we also have to listen to Mozart’s music and give them massages.

For another example, if the train sprays sparks and burns flax, what will he do if the railway company, flax and farmland are all the same owner? You have to know that there are many ways to prevent the sparks from the train from burning the flax. If you say that the railway company is fully responsible, then the railway company must take some measure or another to prevent the sparks it sprays from burning the flax.

For example, let’s say the train needs to be converted into an EMU. Is this possible? This was a case in 1914, so it’s impossible; high walls could be built along the railway line to prevent sparks from erupting, but the cost would be very high; the railway could also be diverted, which would also be very costly. ; You can also reach an agreement with all the farmers along the way to buy an extra ten meters of land next to their railway, so that the farmers will not stack flax too close to the railway. This can also prevent accidents, but the cost of doing so is also very high. High. You can imagine that if the railroad and the farm were owned by the same person, he would of course take the cheapest way to avoid accidents. In fact, when this case was decided, there was such a detail.

At that time, most judges believed that the railroad should compensate farmers, but there was a famous judge named Oliver Wendell Holmes, who was ruling A personal opinion is written next to it. He said: "Although we all believe that the railway should compensate farmers, we imagine that if the total income and output of the railway and farmers cannot reach the maximum, then the farmers may have to bear a certain degree of responsibility." In real life, , if the railway and farmland are owned by one person, of course he will say, "Can I move the place where the flax is stacked just a little bit further, and the accident can be avoided." This is the cheapest way, you don't I would buy some firecrackers and go home, saying that you have to put them by the stove because the firecrackers are yours and you have the final say in this home. You would conversely say, since the firecrackers are yours and the stove is also yours, then put the firecrackers a little further away. This idea is very important. It was based on this idea that Coase was saying that the railroad burned the flax, but the blame may lie with the farmer. Because the cost that farmers have to pay to avoid accidents is much lower than the cost that railroads have to pay to avoid accidents, whoever pays lower costs should bear greater responsibility. If the responsibility is shared in this way, the total cost to the entire society to avoid accidents will be minimized.

In other words, whoever can make better use of resources should receive the resources. But are there any conditions to this sentence? Is it gangster logic?

For example, who first owned the diamond. Diamonds first belonged to miners, because they were the ones who dug them out. But have you ever seen those miners with diamond necklaces hanging all over their necks? No. Where have all the diamonds gone? The diamond traveled thousands of miles and ran to Bai Fumei's neck and to their fingertips. Whoever uses it well will get it.

For another example, who owns Taobao store data? There are many customers shopping on Taobao, and when they visit a store, they leave electronic traces of their visit. Who owns this data? You can say that the data belongs to the customers, because they visit the store and the data is generated by them; you can also say that the data belongs to the e-commerce company. Since customers come to the e-commerce store to browse, the electronic footprints they leave behind It should be owned by the e-commerce company; the Taobao platform can also be said to be owned by itself, because these data are generated on Taobao's platform and stored on its platform, so these data should be owned by it. The father-in-law is right, and the mother-in-law is right. Who do you think these data should belong to? According to Coase's law, we can predict that no matter who originally generated this data, no matter where it exists, whoever can make good use of this data will continue to toss and fight for it, and finally the data will fall into their hands. Who can put this data to good use? Customers visiting stores cannot use this data, and e-commerce companies are unlikely to make good use of this data. The Taobao platform is more likely to make good use of this data. Finally, those who design e-commerce product pages are particularly sensitive to this data. This data is particularly useful to them, and they will work hard to obtain this data to design the web page more appropriately. Therefore, if we can do system design, we should design the system to make it easier for people who can better use the data to obtain the data and minimize the obstacles involved. In this way, these data can produce greater benefits. Whoever uses it well will get it.

Xue Zhaofeng’s Economics Class

20170327-20170331