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 costs were used in one case to show that if they were not included in the analysis, the firm has no purpose, while in the other I showed, as I thought, that if transaction costs were not introduced into the analysis, for the range of problems considered, the law had no purpose (p. 62).
Now he’s back pounding the pavement in support of his new book, How China Went Capitalist. We spoke of his op-ed in the WSJ, and now here is an interview with him on NPR.
The interview is mostly a review of his career, including the famous lighthouse debate.