Given the brilliance of the discussion of Sidgwick and Coase, I am hesitant to ask a question that probably should have been answered for me in Econ 10, back in 1962-63, except James Tobin was priming the pump and I went on to become a political theorist. I have a question about Coase, that has been intensified by the discussion -- especially the noise around the airport example. My impression is that Coase, whom I have not read for about two decades, is absolutely brilliant in terms of giving a free market, individualistic, static explanation of how, in any circumstances where the costs of negotiation are low (zero?), the two parties will come up with the optimal solution for each of the parties. That is fine, but has always struck me as very individualistic, with no attention to what I would think of as social interests. Cannot, for instance, there be a social decision (a governmental dictate) that airplanes should be forced to try to reduce their noise, and therefore the government should introduce a bias into the negotiations, or a regulation that insists that noise be reduced (rather than individuals be moved -- and traditional communities be upset). The society / the government might think, for instance, that restrictions on noise might lead to technological innovation about noise control that would produce benefits throughout the society, or that penalizing noise (rather than everyone on Long Island who lives under the JFK air lanes) is a socially more acceptable result. Or, to go to the example I remember from Coase, why not make the railroads reduce their sparks -- perhaps also by giving them a corridor that farmers need to stay out of. The main reason I mention this issues is that, when I first ran across Coase, it seemed to me that environmental issues were completely ignored by his article -- or, rather, they were left to the negotiations of the individual parties, neither of whom need care about the environment. So I wanted the terms of the negotiations to be biased in favor of the environment. I realize that I may have phrased the above in a relatively (!) ignorant way (especially I may be missing a dynamic where airlines and railroads may be encouraged to reduce their pollution because it may lessen how much they have to pay .... -- but don't lots of other people (who haven't yet been attacked by railroads or airlines) benefit if railroads and airlines are 'encouraged' to reduce pollution ....) (I also do not remember at all how Coase brings into question issues of causality in his last few pages, but that may be just as well ....) If the above is just a hopelessly ignorant question, I apologize. It is a serious question to the extent that I remember convincing myself, twenty-five years ago, that Coase's narrow argument was brilliant but not helpful for environmental issues (or, perhaps, other 'social' concerns), unless the government added back regulations or a bias into the negotiations. Peter G. Stillman