Wednesday, September 7, 2016

Remembering Ronald Coase

by Levi Russell

The third year anniversary of Ronald Coase's death was last Friday. My Facebook and Twitter were alive with remembrances of this great economist, so I thought I'd put a few articles/videos/podcasts related to Coase for FH readers.

Though Coase is most famous for his work on transaction costs, what I find most interesting about his is his unique approach to economics in general. In the opening of this video interview, Coase says "Economics has become a theory-driven subject and I believe the approach should be empirical. You study the system as it is, understand why it works the way it does, and consider what changes could be made and what effects they would have." Coase derisively referred to abstract theoretical economics as "blackboard economics." In reading his work, the reader gets the sense that Coase is looking at the behavior of real people and trying to determine the underlying causal mechanisms. This is what makes Coase a great economist.

Here's an article on Coase that gives his background and surveys his most popular work. Here's a video featuring lectures on Coase's contributions by other well-known economists.

The video I linked to above, as well as this blog post of mine featuring Deirdre McCloskey, corrects the record on "the Coase Theorem." Speaking of my blog posts, here's another one that provides a summary of one of Coase's lesser-known, but no less fantastic, papers.

Finally, this post of mine summarizes a point by Bryan Caplan that, given his stated perspective on economic theory, I think Coase would have appreciated. It's a simple empirical observation that fundamentally challenges typical applications of standard monopoly theory.

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