> Which only holds when transaction costs are negligible,
That's why I said these models are not exact. They still work ok; instead of being Pareto optimal we're epsilon-Pareto optimal. With some form of small government managing large-scale many-party contracts, we can bring the overhead of Coase-style externality management down very low.
> Too little being done to reduce CO2 emissions,
Again, via Coase, we could find an approximately correct internalization incentive via increasing the purview of trespass law. Polluting would involve the purchase of easement rights. This would be very hard to organize with no government, but feasible with a small government.
> Microsoft monopoly in the late 90s
The government didn't solve this problem, they contributed to it. One of the reasons MS got so huge was federal procurement contracts. The MS monopoly got busted up because other companies (namely Apple) started making better computers, and now we also have Google and Linux in the fold in a major way.
> Broadband providers in the US
This is the fault of regional government line leasing rules, which prevent competition by only allowing one company (maybe 2) to service a building at a time. If the government were behaving optimally, either from a social good or profit-making perspective, we would have more ISPs per building in most places, leading to actual competition.
> Essentially every Health and Safety regulation ever exists to fix a market failure. In the small government world, employers see no cost of workers dying of lung cancer in their 60s from breathing asbestos, etc.
This was fixed because of legislative pressure by labor unions, not out of the charity of the government. If the government decided they weren't responsible for this, unions would just have taken a different approach. Probably just some sort of insurance contract internalizing the risk of contracting a work-related injury or illness.
> I could go on.
Please do; nothing you've said so far has been very compelling.
That's why I said these models are not exact. They still work ok; instead of being Pareto optimal we're epsilon-Pareto optimal. With some form of small government managing large-scale many-party contracts, we can bring the overhead of Coase-style externality management down very low.
> Too little being done to reduce CO2 emissions,
Again, via Coase, we could find an approximately correct internalization incentive via increasing the purview of trespass law. Polluting would involve the purchase of easement rights. This would be very hard to organize with no government, but feasible with a small government.
> Microsoft monopoly in the late 90s
The government didn't solve this problem, they contributed to it. One of the reasons MS got so huge was federal procurement contracts. The MS monopoly got busted up because other companies (namely Apple) started making better computers, and now we also have Google and Linux in the fold in a major way.
> Broadband providers in the US
This is the fault of regional government line leasing rules, which prevent competition by only allowing one company (maybe 2) to service a building at a time. If the government were behaving optimally, either from a social good or profit-making perspective, we would have more ISPs per building in most places, leading to actual competition.
> EpiPen pricing
FDA's fault. http://slatestarcodex.com/2016/08/29/reverse-voxsplaining-dr...
> Essentially every Health and Safety regulation ever exists to fix a market failure. In the small government world, employers see no cost of workers dying of lung cancer in their 60s from breathing asbestos, etc.
This was fixed because of legislative pressure by labor unions, not out of the charity of the government. If the government decided they weren't responsible for this, unions would just have taken a different approach. Probably just some sort of insurance contract internalizing the risk of contracting a work-related injury or illness.
> I could go on.
Please do; nothing you've said so far has been very compelling.