An Austrian View on Externalities, Monopoly (Hint: These are NOT Market Failures!)

Here are several letters to me from W:

Letter 1:

From: W
Sent: Monday, March 27, 2017 6:46 PM
To: Walter Block
Subject: Re: permissions

Hi Dr. Block!

You are a hero of mine. I don’t have many.

I pray you remain healthy, wealthy, and wise for many years to come.

One question about your future, if I may.

Do you have any plans to retire, ever?

Please answer that you don’t.

Sincerely, W

P.S. Reason I ask, my child is still a full four years away from heading off to university…

Response 1:

On 27 March 2017 at 19:56, Walter Block <[email protected]> wrote:

Thanks for your kind words.

https://www.lewrockwell.com/lrc-blog/retirement-not-bloody-likely/

I look forward to having your child in my classes.

Letter 2:

On Tue, 28 Mar 2017 at 11:20, William Bowman <[email protected]> wrote:

Awesome! Thank you so much sir! It is my honor to have my email used in such fashion and thanks much for the perfect answer! Bill

Letter 3:

———- Forwarded message ———

From: W

Date: Sat, 3 Aug 2019 at 14:04

Subject: Re:

To: Walter Block <[email protected]>

Hello, my hero, Dr. Block! I enjoyed today’s participant chiming in and your rebuttal on the loaf of bread as linked to below. You are brilliantly correct.

https://www.lewrockwell.com/lrc-blog/stealing-a-load-of-bread-part-ii/

(In addition, a point of some importance I believe, the thief of the bread assumes that the owner of it is not dying of starvation, but this cannot be known.)

Kindest regards this August! W

P.S. I’d be interested in links to how to lead whose who will argue “externalities” to their deaths away from their anti-ancap ways of thinking.

On Tue, 7 May 2019 at 22:47, William Bowman <[email protected]> wrote:

Letter 4:

On Monday, 6 May 2019

Hi Dr. Block!

I am at a standstill with friends.

They contend that “externalities” are why anarcho-capitalism can never be a real consideration.

They say that having no government will automatically bring us to “feudalism.”

They worry about Nestle (or another company) gaining a monopoly on the water supply.

I sure want to alleviate their fears, but have been unable to as of yet.

When you get a chance, anytime, anytime at all, I’d be interested in some convincing arguments as to why they need not be concerned; I want to use them and convert them, once and for all.

Happy May to you and yours!

You remain my hero. W

From: Walter Block <[email protected]>

Sent: Sunday, August 04, 2019 10:32 PM

To: W

Subject: RE: Resending; yesterday’s email apparently wasn’t delivered

Dear W:

Here’s some stuff on externalities:

Barnett and Block, 2007, 2009; Block, 1983, 1990, 1992, 1993, 2003; Cordato, 1992; Hoppe, 2003; Lewin, 1982; Rothbard, 1982; Santoriello and Block, 1996; Terrell, 1999.

Barnett, William II and Walter E. Block. 2007. “Coase and Van Zandt on Lighthouses,” Public Finance Review, Vol. 35, No. 6, November, pp. 710-733

Barnett, William and Walter E. Block. 2009. “Coase and Bertrand on Lighthouses,” Public Choice; 140(1–2):1–13, http://dx.doi.org/10.1007/s11127-008-9375-x

Block, Walter E. 1983. “Public Goods and Externalities: The Case of Roads,” The Journal of Libertarian Studies: An Interdisciplinary Review, Vol. VII, No. 1, Spring, pp. 1-34; http://www.mises.org/journals/jls/7_1/7_1_1.pdf

Block, Walter E. 1990. “Resource Misallocation, Externalities and Environmentalism in the U.S. and Canada,” Proceedings of the 24th Pacific Northwest Regional Economic Conference, pp. 91-94

Block, Walter E. 1992. “Institutions, Property Rights and Externalities: The Case of Water Quality,” Agriculture and Water Quality: Proceedings of an Interdisciplinary Symposium, Murray H. Miller, J. E. FitzGibbon, Glenn C. Fox, R.W. Gillham and H.R. Whiteley, eds., Guelph Centre for Soil and Water Conservation, University of Guelph Press, pp. 191-208.

Block, Walter E. 1993. “Society, Stakeholders, and Externalities,” Fraser Forum, February, pp. 18-19; http://oldfraser.lexi.net/publications/forum/1993/february/

Block, Walter E. 2003. “National Defense and the Theory of Externalities, Public Goods and Clubs.” The Myth of National Defense: Essays on the Theory and History of Security Production, Hoppe, Hans-Hermann, ed., Auburn: Mises Institute, pp. 301-334; http://www.mises.org/etexts/defensemyth.pdf

Cordato, Roy E. 1992. Welfare Economics and Externalities in an Open-Ended Universe: A Modern Austrian Perspective, Boston: Kluwer

Hoppe, Hans-Hermann, ed. 2003. “National Defense and the Theory of Externalities, Public Goods and Clubs.” The Myth of National Defense: Essays on the Theory and History of Security Production, Hoppe, Hans-Hermann, ed., Auburn: Mises Institute

Lewin, Peter.  1982. “Pollution Externalities: Social Cost and Strict Liability.”  Cato Journal, vol. 2, no. 1, Spring, pp. 205-229.

Rothbard, Murray N. 1982. “Law, Property Rights, and Air Pollution,” Cato Journal, Vol. 2, No. 1, Spring; reprinted in Economics and the Environment: A Reconciliation, Walter E. Block , ed., Vancouver: The Fraser Institute, 1990; http://www.mises.org/rothbard/lawproperty.pdfhttp://mises.org/story/2120

Santoriello, Andrea and Walter E. Block. 1996. “Externalities and the Environment,” The Freeman, November, Vol. 46, No. 11, pp. 755-756, http://www.thefreemanonline.org/featured/externalities-and-the-environment/http://www.fee.org/vnews.php?nid=3628; reprinted in El Diario, (Bolivia), July 1997; http://www.fee.org/publications/the-freeman/article.asp?aid=4599&print_view=true

Terrell, Timothy D. 1999. “Property Rights and Externality: The Ethics of the Austrian School.” Journal of Markets and Morality. Vol. 2, No. 2, Fall;

http://www.acton.org/publications/mandm/mandm_article_114.php

Here are some readings on monopoly:

Anderson, et. al., 2001; Armentano, 1972, 1982, 1989, 1999; Armstrong, 1982; Barnett, et. al., 2005, 2007; Block, 1977, 1982, 1994; Block and Barnett, 2009; Boudreaux and DiLorenzo, 1992; Costea, 2003; DiLorenzo, 1996; DiLorenzo and High, 1988; Henderson, 2013; High,1984-1985; Hull, 2005; McChesney, 1991; McGee, 1958; Rothbard, 2004; Shugart, 1987; Smith, 1983; Tucker, 1998A, 1998B

Anderson, William, Walter E. Block , Thomas J. DiLorenzo, Ilana Mercer, Leon Snyman and Christopher Westley. 2001. “The Microsoft Corporation in Collision with Antitrust Law,” The Journal of Social, Political and Economic Studies, Vol. 26, No. 1, Winter, pp. 287-302

Armentano, Dominick T. 1972. The Myths of Antitrust, New Rochelle, N.Y.: Arlington House.

Armentano, Dominick T. 1982. Antitrust and Monopoly: Anatomy of a Policy Failure, New York: Wiley

Armentano, Dominick T. 1989.  “Antitrust Reform: Predatory Practices and the Competitive Process.” Review of Austrian Economics. Vol. 3, pp. 61-74. http://www.mises.org/journals/rae/pdf/rae3_1_4.pdf

Armentano, Dominick T. 1999. Antitrust: The Case for Repeal.  Revised 2nd ed., Auburn AL: Mises Institute

Armstrong, Donald. 1982. “Competition versus Monopoly: Combines Policy in Perspective.” The Fraser Institute: Vancouver, BC, Canada

Barnett, William, Walter E. Block and Michael Saliba. 2005. “Perfect Competition: A Case of ‘Market-Failure,’” Corporate Ownership & Control. Vol. 2, No. 4, summer, p. 70-75

Barnett, William II, Walter E. Block and Michael Saliba. 2007. “Predatory pricing.” Corporate Ownership & Control, Vol. 4, No. 4, Continued – 3Summer; pp. 401-406

Block, Walter E. 1977. “Austrian Monopoly Theory — a Critique,” The Journal of Libertarian Studies, Vol. I, No. 4, Fall, pp. 271-279.

Block, Walter E. 1982. Amending the Combines Investigation Act, Vancouver: The Fraser Institute.

Block, Walter E. 1994. “Total Repeal of Anti-trust Legislation: A Critique of Bork, Brozen and Posner, Review of Austrian Economics, Vol. 8, No. 1, pp. 35-70.

Block, Walter and William Barnett. 2009. “Monopsony Theory.” American Review of Political Economy. June/December, Vol. 7(1/2), pp. 67-109; http://www.arpejournal.com/ARPEvolume7number1-2/Block-Barnett.pdfhttp://www.arpejournal.com/

Boudreaux, Donald J., and DiLorenzo, Thomas J. 1992. “The Protectionist Roots of Antitrust,” Review of Austrian Economics, Vol. 6, No. 2, pp. 81-96

Costea, Diana. 2003. “A Critique of Mises’s Theory of Monopoly Prices.” The Quarterly Journal of Austrian Economics. Vol. 6, No. 3, Fall, pp. 47-62; http://www.mises.org/journals/qjae/pdf/qjae6_3_3.pdf

DiLorenzo, Thomas J. 1996. “The Myth of Natural Monopoly,” Review of Austrian Economics, Vol. 9, No. 2, pp. 43-58; http://www.mises.org/journals/rae/pdf/rae9_2_3.pdf

DiLorenzo, Tom and Jack High. 1988. “Antitrust and Competition, Historically Considered,” Economic Inquiry, Vol. 26, No. 1, pp. 423-435, July.

Henderson, David R. 2013. “The Robber Barons: Neither Robbers nor Barons.” Library of Economics and Liberty. March 4;

http://www.econlib.org/cgi-bin/printarticle2.pl?file=Columns/y2013/Hendersonbarons.html

High, Jack. 1984-1985. “Bork’s Paradox: Static vs Dynamic Efficiency in Antitrust Analysis,” Contemporary Policy Issues, Vol. 3, pp. 21-34.

Hull, Gary, ed. 2005. The Abolition of Antitrust. New Brunswick, NJ:  Transaction Publishers

McChesney, Fred. 1991. “Antitrust and Regulation: Chicago’s Contradictory Views,” Cato Journal, Vol. 10.

McGee, John S.  1958. “Predatory Price Cutting: The Standard Oil (New Jersey) Case,” The Journal of Law and Economics, October, pp. 137-169

Rothbard, Murray N. (2004 [1962]). Man, Economy and State, Auburn AL: Ludwig von Mises Institute, Scholar’s Edition; http://www.mises.org/rothbard/mes.asp

Shugart II, William F. 1987. “Don’t Revise the Clayton Act, Scrap It!,” 6 Cato Journal, 925

Smith, Jr., Fred L. 1983. “Why not Abolish Antitrust?,” Regulation, Jan-Feb, 23; http://cei.org/op-eds-and-articles/why-not-abolish-antitrust

Tucker, Jeffrey. 1998A. “Controversy: Are Antitrust Laws Immoral?” Journal of Markets & Morality. Vol. 1, No. 1, March, pp. 75-82; http://www.acton.org/publications/mandm/mandm_controversy_35.php

Tucker, Jeffrey. 1998B. “Controversy: Are Antitrust Laws Immoral? A Response to Kenneth G. Elzinga.” Journal of Markets & Morality. Vol. 1, No. 1, March, pp. 90-94; http://www.acton.org/publications/mandm/mandm_controversy_37.php

Best regards,

Walter

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3:28 pm on September 8, 2019