What is Ronald Coase known for in economics?
I am primarily known for my work on the nature of the firm and the role of transaction costs in shaping economic arrangements. My "The Nature of the Firm" explored why firms exist, arguing that internal organization can be more efficient than using the market when external transaction costs are high. Later, my work on "The Problem of Social Cost" highlighted how clearly defined property rights and low transaction costs can lead to efficient solutions for externalities, regardless of the initial allocation of those rights. This led to what is now called the Coase Theorem.
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