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Taking the Coase Theorem Seriously

Author

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  • McKelvey, Richard D.
  • Page, Talbot

Abstract

It is sometimes believed that technical apects of a theorem have little to do with the policy implications of the theorem. On the contrary, in this paper we argue that for the Coase Theorem, the technical details are very important in understanding the potential policy implications, since the two interact in a way that leads to a dilemma: a formally correct version of the theorem that yields the usual conclusions requires assumptions that are too restrictive to give the theorem much policy relevance. On the other hand, relaxing the assumptions of the theorem to be sufficiently plausible to be applicable in real world settings modifies the conclusions of the theorem.

Suggested Citation

  • McKelvey, Richard D. & Page, Talbot, 1999. "Taking the Coase Theorem Seriously," Economics and Philosophy, Cambridge University Press, vol. 15(2), pages 235-247, October.
    • Handle: RePEc:cup:ecnphi:v:15:y:1999:i:02:p:235-247_00
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    Citations

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    Cited by:

    1. Elodie Bertrand, 2019. "Much ado about nothing? The controversy over the validity of the Coase theorem," Post-Print hal-03479468, HAL.
    2. Nelson, Douglas R., 2015. "Prospects for Constitutionalization of the WTO," World Trade Review, Cambridge University Press, vol. 14(1), pages 135-153, January.
    3. George Halkos & Nicholas Kyriazis, 2003. "Property Rights and Game-Theory Implications of Satellite Communications: The Bilateral Case of Greece and Russia," European Journal of Law and Economics, Springer, vol. 15(3), pages 233-250, May.
    4. Acemoglu, Daron, 2003. "Why not a political Coase theorem? Social conflict, commitment, and politics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 620-652, December.
    5. Manuel Willington & Eduardo Saavedra, 2011. "Eficiencia Productiva y Asignación de Cuotas de Pesca en Chile: Teorema de Coase y Asimetrías de Información," ILADES-UAH Working Papers inv264, Universidad Alberto Hurtado/School of Economics and Business.
    6. Elodie Bertrand, 2014. "Allowing exchanges over externalities: From ban to obligation [Autorisation à l'échange sur des externalités: De l'interdiction à l'obligation]," Post-Print hal-03507657, HAL.
    7. Élodie Bertrand, 2006. "La thèse d'efficience du « théorème de Coase ». Quelle critique de la microéconomie ?," Revue économique, Presses de Sciences-Po, vol. 57(5), pages 983-1007.
    8. Bonsu Kwadwo Osei, 2021. "Axiomatic Formulation of the Optimal Transaction Cost Theory in the Legal Process Through Cobb-Douglas Optimization," Economic and Regional Studies / Studia Ekonomiczne i Regionalne, Sciendo, vol. 14(3), pages 385-389, September.
    9. van Suntum, Ulrich, 2021. "The Global Protection Organisation (GPO) - A Proposal to Improve the Handling of Global Challenges," MPRA Paper 108984, University Library of Munich, Germany.
    10. Steven G. Medema, 2020. "The Coase Theorem at Sixty," Journal of Economic Literature, American Economic Association, vol. 58(4), pages 1045-1128, December.
    11. Osei Bonsu, Kwadwo, 2021. "Axiomatic Formulation Of The Optimal Transaction Cost Theory In The Legal Process Through Cobb-Douglas Optimization," Economic and Regional Studies (Studia Ekonomiczne i Regionalne), John Paul II University of Applied Sciences in Biala Podlaska, vol. 14(3), September.

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