The Coase Theorem occupies a central place in modern economic thought, reshaping how scholars and policymakers understand externalities, property rights, and the role of government intervention. Named after the British economist Ronald H. Coase, it originated in his landmark article The Problem of Social Cost (1960), which has become one of the most cited works in the history of economics. Coase’s insight was both deceptively simple and radically transformative: under certain conditions, private bargaining between individuals can solve problems of externalities without the need for state intervention. This challenged the then-dominant Pigovian framework, which emphasised taxes and subsidies to internalise external costs and benefits.
Read MoreThe Coase Theorem occupies a central place in modern economic thought, reshaping how scholars and policymakers understand externalities, property rights, and the role of government intervention. Named after the British economist Ronald H. Coase, it originated in his landmark article The Problem of Social Cost (1960), which has become one of the most cited works in the history of economics. Coase’s insight was both deceptively simple and radically transformative: under certain conditions, private bargaining between individuals can solve problems of externalities without the need for state intervention. This challenged the then-dominant Pigovian framework, which emphasised taxes and subsidies to internalise external costs and benefits.
Read MoreSay’s Law, often summarised by the phrase “supply creates its own demand,” is one of the most debated principles in the history of economic thought. At its core, it asserts that production is the source of demand: the act of producing goods generates incomes that enable equivalent purchasing power, thereby ensuring that general overproduction, or a “general glut,” is impossible. Although sometimes caricatured, Say’s Law has played a central role in shaping classical and neoclassical economic theory, as well as in providing a foil for later critiques, most notably from John Maynard Keynes.
Read MoreThe relationship between economic growth and unemployment has long been a central concern of macroeconomics, particularly for policymakers seeking to balance objectives of stability and full employment. One of the most enduring contributions to this discussion is Okun’s Law, named after the American economist Arthur M. Okun, who first articulated the relationship in the early 1960s. While not a structural law in the sense of immutable causation, Okun’s Law provides a robust empirical regularity linking changes in output to changes in unemployment. Its simplicity and intuitive appeal have made it a cornerstone of applied macroeconomic analysis, even as its exact parameters vary across time and context.
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