Tuesday, November 2, 2010

Hmmm... It's not always a B&B story...

One of your colleagues shares this report from the Washington Examiner: Baptists & Bootleggers: Red-light-camera manufacturers lobby for red-light cameras.
There's only one problem. This isn't a good Bootleggers and Baptists story.
The Examiner jumped to conclusions in making its analysis. Actually, I think the staffer probably had recently read something about Baptists and Bootleggers and went looking for an example of the phenomenon. (Heh. That's what you were doing, too.)
Merely identifying providers of cameras as employing a profit motive is insufficient grounds for employing this paradigm. Both sides to a transaction within the marketplace are also employing the profit motive.
The question is whether the same transaction could have happened in the marketplace? B&B stories require the government to broker an agreement because there are third parties who are harmed by the legislation. In the basic B&B story, alcohol consumers are harmed.
But in the red-light story, everyone is better off.
In the end, this is actually a better example of the difficult of providing public goods as compliments to goods which fall into the commons.

An excellent final exam multiple choice question might ask: Which of the following is NOT a good example of the Bootleggers and Baptists phenomenon?

1 comment:

  1. By the way, I just submitted a letter to the editor at the Examiner regarding this error. It is most likely too late to get printed, the original article ran in July.