Re:PG&E-friendly wildfire bill being prepared by lawmakers i...
by schoen on Tuesday November 20, 2018 @11:08PM
(#18500096)
There's a long discussion in Coase's classic "The Problem of Social Cost" about the apportionment of liability between railroads and landowners adjacent to the railways when fires are started by sparks from trains.
Basically Coase says that it's not necessarily the most economically efficient to blame the railroad that created the sparks, and that it depends on other factors (in the super-simple formulation that people sometimes attribute to Coase, this could include who could most cheaply act to mitigate the fires).
I think Coase would agree with you that we can't automatically assume that blaming PG&E and making PG&E pay for all the damages will lead to the most efficient outcomes for California as a whole in the future.
http://home.cerge-ei.cz/ortmann/UpcesCourse/Coase%20-%20The%...
Basically Coase says that it's not necessarily the most economically efficient to blame the railroad that created the sparks, and that it depends on other factors (in the super-simple formulation that people sometimes attribute to Coase, this could include who could most cheaply act to mitigate the fires).
I think Coase would agree with you that we can't automatically assume that blaming PG&E and making PG&E pay for all the damages will lead to the most efficient outcomes for California as a whole in the future.