Failures of the Market and the Public Sector
Matthew E Kahn from the Environmental and Urban Economics blog writes:
I was just in a UCLA men’s bathroom. A dude was sitting in a locked stoll. A toliet flushed and he walked out. Without washing his hands, he kept going and exited the bathroom. I was grossed out. As an economist, I’d like to know what would have been the private costs for him to have washed his hands? And, how large the social costs he imposes on the UCLA population by walking around and touching stuff with his dirty hands? As a social scientist, I’d like to know why he chose to be a bad citizen. He didn’t look like he was in a rush. I saw him walk off with a lady friend as they strolled on together. Is he “passive aggressive”? Is he lazy?
Interestingly enough, I have a story about UCLA men’s bathrooms too. Back when I was a student, there was a drought going on. So posted on walls in a lot of bathrooms was a sign that said: “Report all leaks” and the phone number of the maintenance department. As an experiment, I called in to report having taken a leak. It turns out that a) one leak was more than they wanted to hear about, much less all leaks and b) at least one person in the maintenance department had no sense of humor.
But I digress… it seems that there are some problems for which there is no solution whatsoever – not the market, and not the government. Or am I wrong… what’s the solution to the problem Kahn highlights?