Hot sauce hold-up.

• Author: Feeney, Matthew
• Position: Sriracha's spillover effects - Huy Fong Foods - Brief article

A LOS ANGELES Superior Court judge has ordered Huy Fong Foods, the manufacturer of Tuong Ot Sriracha hot sauce, to partially shut down a factory in Irwindale, California, thereby providing a real-life lesson in the economics of externalities.

The November order was a response to the factory's pungent emissions. The neighbors' complaints ranged from the comparatively mild, such as eye irritations, to the severe, with some residents leaving their homes--or being unable to leave--because of the smell. Judge Robert H. O'Brien rejected a request that the whole factory be shut down, but he told the company to halt the activities producing those effects and take steps to mitigate them. Shortly afterward, the...