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The Lighthouse Debate and the Dynamics of Interventionism

  • Rosolino A. Candela
  • Vincent J. Geloso
Article

Abstract

Coase’s publication of “The Lighthouse in Economics” (1974) sparked a polarizing debate over his claim that government intervention is not necessary for the existence of a private lighthouse market. The purpose of this paper is to reframe this debate by asking the following question: why was nationalization the outcome of lighthouse regulation? We answer this question by utilizing the Austrian theory of interventionism to illustrate how regulation of the lighthouse market distorted the entrepreneurial market process. We argue that the nationalization of the lighthouse market in England and Wales was a result of prior government failure to exclude private lighthouses from the market, not a failure of the entrepreneurial market process to privately provide lighthouses.

Keywords

Entrepreneurship Dynamics of Interventionism Lighthouses Regulation 

JEL Classification

B53 D72 L51 

Notes

Acknowledgements

We are very grateful to Peter Boettke, Christopher Coyne, Caleb Fuller, and Ennio Piano for their helpful comments and feedback in writing this paper. We thank two anonymous referees for their valuable feedback and comments, which greatly improved our paper. We also thank the archivists at the Trinity House Corporation for providing us with primary source material for this project. Any remaining errors are entirely our own.

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Political Theory Project, Department of Political ScienceBrown UniversityProvidenceUSA
  2. 2.Department of EconomicsBates CollegeLewistonUSA

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