Selling Mayberry: Communities and Individuals in Law and Economics

72 Pages Posted: 12 May 2003 Last revised: 13 Dec 2009

Gideon Parchomovsky

University of Pennsylvania Law School; Bar Ilan University - Faculty of Law

Peter Siegelman

University of Connecticut - School of Law

Abstract

The small village of Cheshire, Ohio was recently acquired in its entirety by the firm whose giant power plant, located at the edge of town, caused it serious pollution problems. Although the plant was worth substantially more than the town, this was not a simple Coasean bargain. This paper combines an ethnographic methodology with theoretical insights from law and economics to present an empirical and theoretic challenge to the standard account of nuisance disputes. We explore the transaction in detail and explain what prevented collective action and holdout problems that are usually thought to hinder bargaining with groups. Specifically, we show how incorporating the role of community into conventional theory offers a new understanding of the likelihood of holdouts, the importance of community dynamics, the interdependency of community-wide nuisance actions, and the role of the law of takings.

Keywords: pollution, nuisance, property, torts, community, externalities, takings

Suggested Citation

Parchomovsky, Gideon and Siegelman, Peter, Selling Mayberry: Communities and Individuals in Law and Economics. California Law Review, Vol. 92, pp. 75, 2004; U of Penn. Law School, Public Law Working Paper 28; U of Penn, Inst for Law & Econ Research Paper No. 03-08. Available at SSRN: https://ssrn.com/abstract=405081 or http://dx.doi.org/10.2139/ssrn.405081

Gideon Parchomovsky (Contact Author)

University of Pennsylvania Law School ( email )

3501 Sansom Street
Philadelphia, PA 19104
United States
215-898-1603 (Phone)

Bar Ilan University - Faculty of Law ( email )

Ramat Gan 52900
Israel
972-2-5317078 (Phone)

Peter Siegelman

University of Connecticut - School of Law ( email )

65 Elizabeth Street
Hartford, CT 06105
United States
860-570-5238 (Phone)
860-570-5242 (Fax)

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