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 intellectual contribution of Arthur Cecil Pigou (1877–1959) to economics has been enduring, particularly through his development of welfare economics and his insights into externalities. Pigou’s work laid the foundations for modern public economics, especially the study of how government intervention can address market failures and improve social welfare. His thinking, often referred to as Pigovian or Pigou economics, emerged from a period of transition in economic theory, as the discipline moved away from the classical preoccupation with production and distribution towards the neoclassical analysis of welfare and efficiency.
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 MoreModern Monetary Theory (MMT) is one of the most provocative schools of thought to emerge in contemporary economics. It challenges conventional wisdom about government spending, taxation, and deficits, reframing the debate on fiscal policy in countries that issue their own fiat currency. At its heart, MMT argues that such governments are not financially constrained in the same way as households or firms. Instead, they have the sovereign capacity to create money, and therefore cannot “run out” of their own currency. This radical reorientation has profound implications for how we think about the limits of public spending, the role of taxation, and the relationship between fiscal and monetary policy.
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