All around the country, conflicts are brewing over aesthetics.
Instead of tolerating sights they don't like -- from tacky porch
furniture to innovative architecture -- more and more Americans are
demanding a world free of "visual pollution." Appearance is getting
the sort of regulatory scrutiny once reserved for public health and
In Portland, Ore., you can no longer build a home whose front is
less than 15 percent windows and doors or whose garage takes up more
than half the facade. The goal, a local official suggested in
response to critics, is to "put a stop to the ugly and stupid houses
that we see going up."
New York City is trying to revise its land use code for the first
time since 1961.
The proposed Uniform Bulk Program would establish a design review
committee and use height limits to preserve the skyline. The new
rules don't claim to be healthful or to preserve historic buildings.
They're all about looks.
"Everything proposed by the Uniform Bulk Program is entirely a
matter of taste," wrote Herbert Muschamp, the architecture critic
for The New York Times.
Suburbanites now take offense at their neighbors' paint colors,
their window frames, even their backyard swing sets. And just about
everywhere, residents are fighting new cell phone towers, which can
block views or just look ugly.
The push to expand the definition of "pollution" to include
aesthetic offenses forces us to re-examine why and how we regulate
the spillovers that economists call externalities. Should we really
ban, tax or otherwise deter any action that has unpleasant effects
on other people?
After all, just about everything people do in society has
spillover effects, many of them unwanted.
Ronald Coase of the University of Chicago addressed these
questions in 1960, in The Problem of Social Cost, an article that
helped win him the 1991 Nobel Prize in economics. But the most
relevant parts of that paper are the least noted.
The paper is most famous for what was later called the Coase
This is the idea that if making deals in the marketplace costs
nothing, it won't matter how the law assigns liability.
If a factory has the right to operate even if it pollutes, then
people who don't want to breathe stinky air can pay the owner not to
If, on the other hand, the neighbors have the right not to suffer
pollution, the factory can pay them to waive that right. In either
case, a deal will be made at the level that makes everyone as happy
But as Coase would be the first to point out, we don't live in a
world where deals are free. Gathering information, rounding up all
the affected parties, negotiating contracts, monitoring pollution
levels and so on are all costly.
These transaction costs can make such happy deals difficult,
though certainly not impossible.
In the real world, the way rights are assigned -- to polluters or
to their neighbors -- does matter. That makes it important to assign
What principles should we use to get the best result?
Coase's first insight is that pollution is not a simple matter of
physical invasion or evildoing. It is a byproduct of valuable
Preventing those actions would also be harmful. …