Changes

==Court decisions==

==Court decisions==

To summarize Ronald Coase's paper ''The Problem of Social Cost'',<ref>Available online for $10 at this [https://www.journals.uchicago.edu/doi/pdfplus/10.1086/466560 University of Chicago website]</ref> a judge should have regard for the total effect of his decision once people adapt to it.

To summarize Ronald Coase's paper ''The Problem of Social Cost'',<ref>Available online for $10 at this [https://www.journals.uchicago.edu/doi/pdfplus/10.1086/466560 University of Chicago website]</ref> a judge should have regard for the total effect of his decision once people adapt to it.  Professor Coase's famous paper<ref>Coase, R. October 1960 ''[http://www.sfu.ca/~allen/CoaseJLE1960.pdf The Problem of Social Cost.]'' Journal of Law and Economics</ref> observes that assigning a property right to one side in a dispute typically does not alter the economically efficient use of resources, as long as parties can easily bargain with each other.

For example, the paper says that making a polluting factory obtain a cleaner smokestack might be a better decision than making the factory owner pay a fine. How might the problem be solved if money did not exist? Another example implied that making a farmer put a fence around his crops might make more sense than making the owner of the cattle which walked on the crops pay a fine. He mentioned a case of sparks from a steam engine causing a brush fire, and that it may not have been fair to make the railroad pay damages depending on the circumstances and technology. His paper also said there was a case in which a wealthy man stocked rabbits on his land and had to pay damages to his neighbor because the rabbits got into the neighbor's garden.  

Only eleven (11) court decisions -- and none by the [[U.S. Supreme Court]] -- have cited the "Coase theorem," and many of those citations are to law review articles that merely include the Coase theorem in their titles.  The paucity of references to the insightful Coase theorem in legal decisions says more about the court system than it does about the theorem.  Law schools generally either ignore the Coase theorem, or are outspokenly hostile to its truth.

Mr. Coase believed the decision may or may not have solved the problem morally, depending on the circumstances. His paper analyzes ways in which paying damages or not to the plaintiff might effect the causes of disputes.  His famous paper turns out to have very little to do with the theorem carrying his name.<ref>Coase, R. October 1960 ''[http://www.sfu.ca/~allen/CoaseJLE1960.pdf The Problem of Social Cost.]'' Journal of Law and Economics</ref>

In 1997 federal district judge Milton Shadur observed the following in one of his opinions when he presided over a case on the U.S. Court of Appeals for the Seventh Circuit:<ref>''Coltman v. Commissioner'', 980 F.2d 1134, 1136-37 (7th Cir. 1992)</ref>

== Pareto Optimal ==

== Pareto Optimal ==