Wednesday, December 29, 2010

New Economists Are Unaware Of Coase's Work

From "Happy Birthday Ronald Coase" by Mario Rizzo:
Today most students at the top economics have never been exposed to Coase’s work.
If economists are not exposed to Ronald Coase's work on property rights and transaction costs, it is unlikely the untrained economists will incorporate Coase's important ideas into their thinking and analyses.

No wonder most economists push for more regulations to solve problems, more taxes and government subsidies to modify consumer and corporate behavior, and more regulatory and government interference in markets to correct undesirable, unwanted and sub-optimal outcomes.

A Coasean analysis of unwanted outcomes would identify the various property rights and look for a market based approach to reduce and eliminate the negative effects without an imposition of more taxes or prohibitory regulations.

No comments:

Post a Comment