During my first weeks as a graduate student in economics, a professor described the Coase Theorem as “nearly a tautology:” Assume a world in which bargaining is costless. If there are gains from trade, the Theorem tells us, the parties will trade. The initial assignment of property rights will not affect the final allocation because the parties will bargain (costlessly) to an efficient outcome. “How can that be a theorem?,” I remember thinking at the time.
Housing Law | Law | Law and Economics | Property Law and Real Estate
Edward R. Morrison,
Coasean Bargaining in Consumer Bankruptcy,
Kreisman Working Papers Series in Housing Law & Policy No. 5
Available at: https://scholarship.law.columbia.edu/faculty_scholarship/2413