The Principle of Institutional Direction: Coase's Regulatory Critique of Intervention
Posted: 29 Feb 2008
Abstract
That Coase`s political convictions changed from an early socialism to a later neo-liberalism stands in apparent contrast to the theoretical consistency of his early (`The Nature of the Firm`) and later (`The Problem of Social Cost`) contributions to economics. Offering further evidence about his early views in particular, this paper takes a fresh look at Coase`s views on competition and antitrust to show that he consistently stressed the role of what we shall call the principle of `institutional direction`, and that this principle involves an important criticism of both neo-liberal and socialist views on regulation and state intervention.
Keywords: Ronald H. Coase, Comparative institutional analysis, Socialist economics, Critique of neo-liberalism, Critique of intervention, Institutional direction
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