Exercise 2: Why the Second Critique Doesn't Simply Restore the Original Story — Possible Solution ======================================================================================================== Simply restoring the original textbook story would mean going back to claiming lighthouses require direct, unassisted government provision because private markets genuinely can't handle their non-excludability problem at all. That's not actually what Van Zandt's and Bertrand's real critique shows either - their point is more specific and more interesting than a simple return to the original claim. Their real argument is that Coase's OWN evidence doesn't actually prove what he claimed it proved: the historical British lighthouses he pointed to weren't purely private, unassisted market solutions - they depended on crown-granted legal rights that let operators forcibly collect light dues from ships, which is a real, government-backed enforcement mechanism, not simply willing buyers and sellers freely trading in an open market. Genuinely voluntary-payment lighthouses, without that legal backing, "did not survive long" in practice. This leaves a real complication that neither the original textbook story nor Coase's own correction fully resolves: the actual historical evidence shows lighthouses were provided through a HYBRID system - privately operated, but only functional because of government-granted, legally-enforced collection rights - which is genuinely different from both "government must provide this directly" and "the free market handles this on its own, no government involvement needed." The real history doesn't cleanly support either the original textbook claim or Coase's own reinterpretation of it. ANSWER: The critique doesn't restore the original story because it doesn't claim private provision is impossible - it shows Coase's own "private" lighthouses actually depended on government-granted, legally enforced collection rights, not a purely free, unassisted market. What remains is a real, more complicated hybrid picture (private operation requiring government-backed legal enforcement) that neither the original textbook claim nor Coase's own correction fully captures. WHY THIS WORKS AS AN ANSWER ------------------------------ This identifies the real, more nuanced hybrid conclusion the evidence actually supports, rather than treating the second critique as simply reversing back to the original textbook position.