Ah, nothing like standard, mainstream econ theory to burn karma.

hobbyjogger · on Feb 18, 2015

See my other comment to your first post. What you posted was, ironically, the exact opposite of what Coast was trying to show.

To be fair, however, yours is a mistake than many, many people have made -- including some very successful economists.

murbard2 · on Feb 18, 2015

You're correct, and I'm aware that the point is that transaction costs exists and that you want the law to allocate rights by default to the least cost avoiders. However, it is a very valuable insight that, on the first order, allocation doesn't matter.

It's also interesting to notice that the Internet and IT in general is lowering transaction costs and pushing us further into a Coasian world.