This past weekend Nobel Laureate Ronald Coase died. He is one of the most influential social science scholars ever, having shaped questions of organizational economics, and virtually founding the field of law & economics. His 1937 paper, “The Nature of the Firm,” addressed the canonical question for organizational economics, and a mere 23 years …
Nobel Laureate Ronald Coase is foundational in both of my courses this term. His 1937 paper, “The Nature of the Firm,” addressed the canonical question for organizational economics, and a mere 23 years later in 1960 he altered the trajectory of social science research with “The Problem of Social Cost.” As Coase puts it: Transaction …
Back in 1937 Ronald Coase asked a question fundamental to the economics of organizations — why are there firms? Then in 1960 he pointed out that externalities stem from the reciprocity of the relationship between harmer and harmee, and that the failure to negotiate and enforce contracts is fundamental to the persistence of “externalities.” As …
The intellectual founder of transaction cost economics, Ronald Coase, turns 100 today. Coase is best known for two papers: “The Nature of the Firm” in 1937 and “The Problem of Social Cost” in 1960. Both are about the importance of transaction costs. The former shows that without transaction costs the firm doesn’t matter, and this …
The latest to pass away is Kenneth Arrow, who by any and all accounts was a genius. A Fine Theorem tells us what we already know, that “Arrow is so influential, in some many areas of economics, that it is simply impossible to discuss his contributions in a single post.” These contributions, of course, …
I’m just going through a backlog of interesting stories to share with my Econ 280 class. First up, Jonathan Adler points us to a short story on a residential subdivision’s successful legal challenge to the construction of a home windmill. The residents of a the Forest Hills subdivision just outside of Carson City, Nevada, argued that the …
Speaking of property rights, what do “shovel-earned parking dibs and intellectual property law” have in common? One answer is that in each case the producer may not be able to capture the full value of its efforts. Without some sort of protection (a chair, a patent) someone else can come along and “appropriate” the value …
Greg Mankiw posted an engaging example of Coase’s theorem based on Dr. Suess’s How The Grinch Stole Christmas. Check it out!
The good folks at Organizations & Markets ask why economists haven’t paid closer attention to the economics of free speech. The classic piece on this is Ronald Coase’s “The Market for Goods and the Market for Ideas” (available from campus IP addresses). Coase asks why the rationale for goods’ market regulation doesn’t carry over into …
