We watched the Las Vegas fireworks on the Strip from our backyard on New Year’s Eve. I had never seen fireworks off casino rooftops before. Covid killed it one year and the other times I haven’t been here, or my house was under construction and we couldn’t watch.
It is funny because all the fireworks were the same and choreographed off each casino rooftop. Caesar’s might compete like heck with Wynn for customers, but when it comes to fireworks they cooperate because they get more out of cooperating than they do from competing.
It made me think of Coase Theorem and if you don’t know Coase you should try to understand it. It’s an incredibly simple theory, but actually super hard to understand in practice. I see it abused a lot by policymakers.
They combine Coase with Dick Thaler’s Nudge and Behavioral Economics and turn it into something scary. Coase traditionally is used in property rights disputes. But, if your mind is flexible, you can use it in a lot of places.
If you think broadly about a lot of classical economic concepts and theories, you can uncover a lot of cool ideas. Gary Becker paved the way with this and there are a lot of others following in his footsteps.
Anyway, when I saw the fireworks, I thought of Coase.
Darryl Waltrip called it "co-opetition. For the uninitiated Waltrip was a Nascar driver turned tv color commentator. He said drivers and teams cooperated and also competed - co-opetition.