Ronald Coase died. All Econ 101 or Intermediate Econ students learn about the Coase Theorem, which sets up a set of conditions - particularly clearly defined property rights and low transaction costs - such that we don't have to worry about externalities and the government need not consider taxation or regulation to deal with things like pollution. However the property rights are assigned, an efficient outcome will be achieved. If you own the right to pollute, I can pay you to not dump as much shit into my river. If I own the right to not be polluted on, you can pay me for the right to dump shit into my river. Who owns the right matters for wealth distribution, but either way the optimal amount of shit is dumped into the river.
But Coase thought the Coase Theorem (how others dubbed it) was sort of ridiculous, a way of pointing out something absurd. Of course property rights are never that clearly assigned, and of course in these situations the number of actors involved is usually so large that transaction and bargaining costs are not sufficiently small.
Still it's often taught as a lesson in how Teh Market can take care of everything, as opposed to a lesson in how there are situations in which Teh Market ain't gonna solve the problem.
