Volume 13, Number 4 (Winter 2010)
There are two Coase theorems. The simplistic one deals with the unrealistic world of zero transactions costs. The more important one addresses itself to the real world, where transactions costs are positive, and, often, larger than any possible gains that might ensue from market transactions. Demsetz and I have been having a decades-long dialogue about the first of these; to wit, is resource allocation invariant to judicial findings as to property rights. Demsetz says yes, I say no. Of late, Brooks joins the fray, finding some good, and some bad, in the position of each of us, Demsetz and myself. This paper is a response to Brooks.
