His Life

Ronald Coase was born in a suburb of London , Willesden , Great Britain on December 29th, 1910 . He is currently Clifton R. Musser Professor Emeritus of Economics at the University of Chicago Law School.

For his discovery and clarification of the significance of transaction costs and property rights for the institutional structure and functioning of the economy, Ronald Coase received the Alfred Nobel Memorial Prize in Economic Sciences in 1991.

Coase is best known for two articles in particular: The Nature of the Firm (1937) which introduces the concept of transaction costs to explain the size of firms. Coase's transaction costs approach is currently influential in modern organizational theory, where it was reintroduced by Oliver Williamson.

The second article is The Problem of Social Cost (1960) which suggests that well- defined property rights could overcome the problems of externalities Coase Theorem ). Coase Theorem is a theorem relating to the economic efficiency of a government's allocation of property rights. In essence, the theorem states that in the absence of transaction costs, all government allocations of property are equally efficient, because interested parties will bargain privately to correct any externality. As a corollary, the theorem also implies that in the presence of transaction costs, government may minimize inefficiency by allocating property initially to the party assigning it the greatest utility.