Coase's Theorem and Ricardo's Comparative Advantage are the best single ideas in Economics. Simple, non-trivial and even inteligent people find it hard to grasp. In his twenties, Coase had already proved that he was a genius. The question posed in The Nature of the Firm "Why do firms exist?" opened a whole new research program and has changed economic thought forever. The answer, almost everybody agree, is transaction costs.
WN: (...) You have high hopes that the future of economics is in China. What makes you think so?
RC: It is obvious. It is the size of Chinese population. A new idea is always accepted only by a small proportion of the population. But a small proportion of the Chinese is a big number.
(...)RC: I am now 100 years old. At my stage, life requires a constant effort. As I told you many times, do not get old. (...)
Friday, January 21, 2011
Happy Birthday, prof Coase!
On December 29th, we has turned 100 year old. Amazing. He is still productive and in July his new book will be available: How China Became Capitalist. Here goes a brilliant recent interview . Excerpts: