• Table of Contents
    • Abstract
    • Keywords
    • Article
      • 1 A brief intellectual history
      • 2 The positive Coase Theorem
        • 2.1 The Coasean methodological revolution
      • 3 The normative Coase theorem
        • 3.1 The relevance of transaction costs and the simple normative Coase theorem
        • 3.2 The complex normative Coase theorem
      • 4 The Coase theorem and its legacy in law and economics
    • See Also
    • Bibliography
    • How to cite this article

Coase theorem

Francesco Parisi
From The New Palgrave Dictionary of Economics, Second Edition, 2008
Edited by Steven N. Durlauf and Lawrence E. Blume
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The Coase Theorem holds that, regardless of the initial allocation of property rights and choice of remedial protection, the market will determine ultimate allocations of legal entitlements, based on their relative value to different parties. Coase's assertion has occasioned intense debate. This article provides an intellectual history of Coase's fundamental theorem and surveys the legal and economic literature that has developed around it. It appraises the most notable attacks to the Coase Theorem, and examines its methodological implications and normative and practical significance in legal and policy settings.
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How to cite this article

Parisi, Francesco. "Coase theorem." The New Palgrave Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online. Palgrave Macmillan. 17 January 2018 <http://www.dictionaryofeconomics.com/article?id=pde2008_C000589> doi:10.1057/9780230226203.0252

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