|
'''Middle English Lyric''' is a [[genre]] of [[English Literature]], popular in the 14th Century, that is characterized by its brevity and emotional expression. Conventionally, the lyric expresses "a moment," usually spoken or performed in the first person. Although some lyrics have narratives, the plots are usually simple to emphasize an occasional, common experience. Even though Lyrics appear individual and personal, they are not "original;" instead, lyrics express a common state of mind.
An '''externality''' occurs in [[economics]] when a decision (e.g., to wear obnoxious perfume or to dress up in nice clothes) causes costs or benefits to individuals or groups other than the person making the decision. In other words, the decision-maker does not bear all of the costs or reap all of the gains from his or her action. As a result, in a competitive market too much or too little of the good will be consumed from the point of view of society. If the world around the person making the decision benefits more than he/she does (education, safety), then the good will be underconsumed by individual decision makers; if the costs to the world exceed the costs to the individual making the choice (pollution, crime) then the good will be overconsumed from society's point of view.
==Implications Audience ==
Middle English Lyrics were meant to be heard, not read. Keeping in mind an [[aural]] [[audience]], the lyric is usually structured with an obvious rhyme scheme, [[refrain]], and sometimes musical effects. The rhyme scheme primarily functions as a [[mnemonic device]] for the audience. The Refrain, however, has several critical functions. The Refrain gives the lyric unity and provides commentary (this is not unlike the bob and wheel found in ''[[Sir Gawain and the Green Knight]]''). In addition to functioning thematically, the refrain encourages audience to participate in singing the lyric. Finally, Musical Effects also encourage audience participation, and they take the form of rhythms and sounds (for example, [[onomatopoeia]] is not an uncommon [[trope]] employed).
== Authorship ==
[[Image:EXTRNLTY.png|thumb|300px|right|External costs and benefits.]] To most economists, the problem of an externality usually concerns the results of market activity. Economists see voluntary exchange as mutually beneficial to both parties in an exchange. On the other hand, either the consumption of a product (perfume, nice clothes) or its production may have external effects -- as in the diagram. Those who suffer from external costs do so involuntarily, while those who enjoy from external benefits do so for free. The left-hand-side of the diagram shows consumption externalities (such as those of perfume), while the right-hand-side shows production externalities (such as those produced by a perfume factory).
Most Middle English Lyrics are anonymous. Because the lyrics reflect on a sort of "community property" of ideas, the concept of copyrighting a lyric to a particular author is usually inappropriate. Additionally, identifying authors is very difficult. Most lyrics are often un-dateable, and they appear in collections with no apparent organic unity. It is most likely many lyrics that survive today were widely recited in various forms before being written down. Evidence for this appears in [[Geoffrey Chaucer]]'s ''[[The Canterbury Tales]]''. Many of Chaucer's lines bear an uncanny resemblance to Middle English Lyrics.
From the perspective of a [[social planner]] or [[welfare economics]], this will result in an outcome that is not socially optimal. From the perspective of anybody affected by the externality, it is either a negative factor in their lives (as with the perfume) or a boon (as with the other's pretty clothes). In the first case, the person who is affected by the negative externality (air pollution) will likely see it as violating his or her freedom to breathe freely. It might even be seen as [[trespassing]] on their lungs, violating their property rights. Thus, an external cost can easily pose an [[ethical]] or [[political]] problem. Alternatively, it might be seen as a case of poorly-defined property rights. An external benefit, on the other hand, may increase the availability of choices for -- and thus the amount of freedom of -- the beneficiaries with no cost to them. They may thus resist the ending of such beneficial externalities along with any associated [[inefficiency|inefficiencies]].
Middle English Lyrics were not meant to be read or written down. Consequently, the few that survive are probably a very small sample of lyrics. Surviving Lyrics appear in [[Miscellanies]], notably the Harley 2253 manuscript. The lyrics often appear with many other types of works, including writings in other languages.
== External Links ==
The value of the effects of the externality are likely not something that can be easily calculated in a [[technocracy|technocratic]] way by economists or social planners, since they reflect the ethical views and preferences of the entire population. Instead, for countries believing in [[popular sovereignty]], some sort of [[democracy|democratic]] method is needed to attach values to the external costs and benefits.
[http://www.luminarium.org/medlit/lyrics.htm Middle English Lyrics]
== Bibliography ==
Sometimes, externalities are called "[[neighborhood effects]]" or "spillovers" but it should not be thought that all externalities are small, spilling over only in the "neighborhood." For example, some claim that the burning of [[hydrocarbon]]s affects the entire "neighborhood" of the Earth, encouraging [[global warming]].
Luria, Maxwell S. and Richard L. Hoffman. ''Middle English Lyrics.'' New York: Norton, 1974.<br>
<nowiki>(Large Selection of Lyrics with Selected Criticism)</nowiki>
Brown, Carleton Fairchild. ''English Lyrics of the XIIIth Century.'' Ed. Carleton Brown. Oxford: The Clarendon press, [1965, c1932].
==Types of externalities==
Gray, Douglas. ''Themes and Images in the Medieval English Religious Lyric.'' London, Boston: Routledge and K. Paul, 1972.
Examples of these kinds of externalities include:
Manning, Stephen. ''Wisdom and Number; Toward a Critical Appraisal of the Middle English Religious Lyric.'' Lincoln: University of Nebraska Press, 1962.
* Pollution by a firm in the course of its production which causes nuisance or harm to others. This is an example of a ''negative externality'', external cost, or external diseconomy.
Reiss, Edmund. ''The Art of the Middle English Lyric; Essays in Criticism.'' Athens: University of Georgia Press, 1972.
* The harvesting by one fishing company in the open sea depletes the stock of available fish for the other companies. Over-fishing may result. This is an example of a [[Common Property Resource|common property resource]], sometimes referred to as the ''[[Tragedy of the commons]]''.
Speirs, John. ''Medieval English Poetry: the Non-Chaucerian Tradition.'' London: Faber and Faber, 1957.
* An individual planting an attractive garden in front of his house may benefit others living in the area. This is an example of a ''positive externality'', beneficial externality, external benefit, or external economy.
Oliver, Raymond. ''Poems without Names; the English Lyric, 1200-1500.'' Berkeley: University of California Press, 1970.
* An individual buying a picture-phone for the first time will increase the usefulness of such phones to people who might want to call him or her. This may lead to the general acceptance of these phones. This is an example of a [[network externality]].
Woolf, Rosemary. ''The English Religious Lyric in the Middle Ages.'' Oxford: Clarendon P., 1968.
In contrast:
[[Category:Middle English literature|Middle English Lyric]]
* A property tycoon buying up a large number of houses in a town, causing prices to rise and therefore making other people who want to buy the houses worse off (perhaps by excluding them from the housing market), is not causing an externality, because the effect is through prices, and is considered part of the normal functioning of the market. Alternatively, these effects are sometimes called "[[pecuniary externality|pecuniary externalities]]", with externalities as defined above called "technological externalities." This article considers only the latter.
Externalities are important in economics because they may lead to inefficiency (see [[Pareto efficiency]]). Because the producers of externalities do not have an incentive to take into account the effect of their actions on others, the outcome will be inefficient. There will be too much activity that causes negative externalities such as pollution, and not enough activity that creates positive externalities, relative to an optimal outcome. As noted, external costs also can imply political conflicts, rancorous lawsuits, and the like. This may make the problem of externalities too complex for the concept of Pareto optimality to handle.
Many of the most important externalities in the economy are concerned with pollution and the environment. See the article on [[environmental economics]] for more discussion of externalities and how they may be addressed in the context of environmental issues.
== Externalities in supply and demand ==
The usual economic analysis of externalities can be illustrated using a standard [[Supply and demand|supply and demand]] diagram if the externality can be monetized (valued in terms of money). An extra supply or demand curve is added, as in the diagrams below. One of the curves is the ''private cost'' that consumers pay as individuals for additional quantities of the good (in competitive markets, the marginal private cost) and the other curve is the ''true'' cost that society as a whole pays for production and consumption of increased production the good (the marginal social cost).
Similarly there might be two curves for the demand or benefit of the good. The social demand curve would reflect the benefit to society as a whole, while the normal demand curve reflects the benefit to consumers as individuals and is reflected as [[effective demand]] in the market.
this was wrong!
=== Beneficial externalities ===
The graph below shows the effects of a positive or beneficial externality. For example, the industry supplying smallpox vaccinations is assumed to be selling in a competitive market. The marginal private benefit of getting the vaccination is less than the marginal social or public benefit by the amount of the external benefit, i.e., the fact that if one person gets the vaccination, others are less likely to get the smallpox even if they themselves are not vaccinated. This marginal external benefit of getting a smallpox shot is represented by the vertical distance between the two demand curves. Assume that there are no external costs, so that social cost ''equals'' individual cost.
[[Image:EXTBENE.jpg|thumb|left|300px|Supply & Demand with external benefits]]</div> If consumers only take into account their own private benefits from getting vaccinations, the market will end up at price '''P<sub>p</sub>''' and quantity '''Q<sub>p</sub>''' as before, instead of the more efficient price '''P<sub>s</sub>''' and quantity '''Q<sub>s</sub>'''. These latter again reflect the idea that the marginal social benefit should equal the marginal social cost, i.e., that production should be increased as long as the marginal social benefit exceeds the marginal social cost. The result in an [[free market|unfettered market]] is ''[[inefficiency|inefficient]]'' since at the quantity '''Q<sub>p</sub>''', the social benefit is greater than the societal cost, so society as a whole would be better off if more goods had been produced. The problem is that people are buying ''too few'' vaccinations.
The issue of external benefits is related to that of [[public goods]], i.e., goods where it is difficult if not impossible to exclude people from benefits. The production of a public good has beneficial externalities for all (or almost all) of the public. As with external costs, there is a problem here of societal communication and coordination to balance benefits and costs. This also implies that pollution is not something solved by competitive markets. The government may have to step in with a collective solution, such as subsidizing or legally requiring vaccine use.
== Externalities and the Coase theorem ==
[[Ronald Coase]] argued that individuals could organise bargains so as to bring about an efficient outcome and eliminate externalities without government intervention. The government should restrict its role to facilitating bargaining among the affected groups or individuals and to enforcing any contracts that result. This result, often known as the "[[Coase Theorem]]," requires that
# Property rights are well defined;
# the number of people involved is small; and
# bargaining costs are very small.
Only if all three of these apply will individual bargaining solve the problem of externalities.
Thus, this theorem does not apply to the steel industry case discussed above. For example, with a steel factory that trespasses on the lungs of a large number of individuals with its pollution, it is difficult if not impossible for any one person to negotiate to be compensated for this transgression. It may extremely expensive even for all individuals to negotiate with the steel firm, especially since some individuals may be tempted to be "[[free rider problem|free riders]]," benefiting from the negotiations without paying any costs. Thus, most economists see the need for [[government]] to be involved with big external costs, to regulate the firm while paying for the regulation with [[taxes]].
The case of the vaccinations also does not fit with the Coase Theorem. The firms of the vaccination industry would have to get together to bribe large numbers of people to have their shots. Individual firms would be tempted to "free ride" and not pay the cost of these bribes. In many cases, it is simpler to involve the government.
This does not say that the Coase theorem is totally irrelevant. For example, if a logger is planning to clear-cut a forest in a way that has a negative impact on the nearby resort, it is quite possible that the resort-owner and the logger could get together to agree to a deal. For example, the resort-owner could pay the logger not to clear-cut -- or could buy the forest. In terms of the examples that started this entry, telling someone that his or her perfume is offensive may easily lead to its being replaced, while praising the clothes of the fancy dresser may encourage the wearing of similar clothes in the future. Of course, none of these bargains may work out as well as desired.
Also, the central government may not be needed. Traditional ways of life may have evolved as ways to deal with external costs and benefits. Alternatively, democratically-run communities can agree to deal with these costs and benefits in an amicable way.
==See also==
* [[Social cost]]
* [[Unintended consequence]]
* [[Welfare economics]]
*[http://www.daviddfriedman.com/Libertarian/The_Swedes.html Introduction to Coase's theory] by [[David Friedman]]
| 