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Coase, Ronald Harry 191 0- (B3)<br />Born in Willesden, England, and a graduate in commerce from the London School of Economics. After holding academic posts in Dundee, Liverpool and the London School of Economics he emigrated to the USA in 1951 to hold chairs in Buffalo and Virginia before settling in Chicago in
Coase theorem (D6, Q2)<br />The proposition that the value and composition of the national income is unaffected by the precise pattern of liability for pollution which the perpetrators and victims have determined. Thus EXTERNALITIEs do not lead to a misallocation of resources provided that there are no TRANSACTION COSTS, and PROPERTY RIGHTS are clearly defined. Private and social costs will be equal under PERFECT COMPETITION.<br /> <br /><em>Reference</em><br />Coase, R.H. (1960) 'The problem of social cost', Journal of Law and Economics 3: 1-44.
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