No Institution is a Free Lunch: A Reconstruction of Ronald Coase

International Review of Economics, Forthcoming

16 Pages Posted: 10 Apr 2012

See all articles by Ugo Pagano

Ugo Pagano

University of Siena - Department of Economics

Date Written: April 10, 2012

Abstract

The two major contributions of Ronald Coase, written at distant points of his long life, have been often interpreted as different and, somehow, contradicting views of the merits of the market mechanism. We argue that the underlying point of the two articles is the same and it can be summarized by the statement that no institution is a free lunch. When the unity of the Coasian theory is properly understood, it offers a powerful challenge to standard neo-classical production theory and opens new analytical tools to understand and to compare the institutions of production.

Keywords: coase, returns to scale, transaction costs, production entitlements

JEL Classification: B290, D020, D290, L230

Suggested Citation

Pagano, Ugo, No Institution is a Free Lunch: A Reconstruction of Ronald Coase (April 10, 2012). International Review of Economics, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2037739

Ugo Pagano (Contact Author)

University of Siena - Department of Economics ( email )

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I-53100 Siena
Italy
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