Top 34 Quotes & Sayings by Ronald Coase

I've been wrong so often, I don't find it extraordinary at all.

You should not forget that without all the work in law and economics, a great part of which has been supported by the John M. Olin Foundation, it is doubtful whether the importance of my work would have been recognized.

Economics as currently presented in textbooks and taught in the classroom does not have much to do with business management, and still less with entrepreneurship.

There is no doubt that the recognition by economists of the importance of the role of the firm in the functioning of the economy will prompt them to investigate its activities more closely.

You get more irrationality within the family and in consumer behavior than you get, say, in the behavior of firms in their purchases.

People have used my views for purposes which are very different from mine.

Changes like the telephone and telegraphy, which tend to reduce the cost of organizing spatially, will tend to increase the size of the firm.

The tools used by economists to analyze business firms are too abstract and speculative to offer any guidance to entrepreneurs and managers in their constant struggle to bring novel products to consumers at low cost.

You wouldn't think there was a need for a Coase Theorem, really.

What I have done is to show the importance for the working of the economic system of what may be termed the institutional structure of production.

In my long life, I have known some great economists, but I have never counted myself among their number nor walked in their company.

During the two centuries since the publication of 'The Wealth of Nations,' the main activity of economists, it seems to me, has been to fill the gaps in Adam Smith's system, to correct his errors and to make his analysis vastly more exact.

The main reason why it is profitable to establish a firm would seem to be that there is a cost of using the price mechanism. The most obvious cost of 'organizing' production through the price mechanism is that of discovering what the relevant prices are.

I tend to regard the Coase theorem as a stepping stone on the way to an analysis of an economy with positive transaction costs.

The law of property determines who owns something, but the market determines how it will be used.

The pollution problem is always seen as someone who was doing something bad that has to be stopped. To me, pollution is doing something bad and good. People don't pollute because they like polluting. They do it because it's a cheaper way of producing something else.

Technology is at a point where we should allow multiple parties to occupy the same spectral space.

Despite all the efforts of art dealers, the number of Rembrandts existing at a given time is limited; yet such paintings are commonly disposed of by auction.

I'm no enthusiast for the Coase Theorem. I don't like it, but it's widely used.

Roughly speaking, when you are dealing with business firms operating in a competitive system, you can assume that they're going to act rationally. Why? Because someone in a firm who buys things at $10 and sells them for $8.00 isn't going to last very long in that firm.

In my youth it was said that what was too silly to be said may be sung. In modern economics it may be put into mathematics.

We must first note that economic factors are taken into account in a world in which ignorance, prejudice, and mental confusion, encouraged rather than dispelled by the political organization, exert a strong influence on policy making.

A firm, therefore, consists of the system of relationships which comes into existence when the direction of resources is dependent on an entrepreneur... As a firm gets larger, there may be decreasing returns to the entrepreneur function, that is, the costs of organising additional transactions within the firm may rise.

I can't remember one [example of regulation] that's good. Regulation of transport, regulation of agriculture - agriculture is a, zoning is z. You know, you go from a to z, they are all bad. There were so many studies, and the result was quite universal: The effects were bad.

Ronnie had it right calling it Torture. That is a much more accurate description the way I see it.

It is clear that these are alternative methods of co-ordinating production. Yet, having regard to the fact that, if production is regulated by price movements, production could be carried on without any organization at all might we ask, why is there any organization?

Existing economics is a theoretical system which floats in the air and which bears little relation to what happens in the real world.

Outside the firm, price movements direct production, which is co-ordinated through a series of exchange transactions on the market. Within a firm, these market transactions are eliminated and in place of the complicated market structure with exchange transactions is substituted the entrepreneur-co-ordinator, who directs production.

In fact, a large part of what we think of as economic activity is designed to accomplish what high transaction costs would otherwise prevent or to reduce transaction costs so that individuals can negotiate freely and we can take advantage of that diffused knowledge of which Friedrich Hayek has told us.

If you torture the data long enough, it will confess.

Economics, over the years, has become more and more abstract and divorced from events in the real world. Economists, by and large, do not study the workings of the actual economic system. They theorize about it. As Ely Devons, an English economist, once said in a meeting: 'If economists wanted to study the horse, they wouldn't go around and look at horses. They'd sit in their studies and say to themselves, `What would I do if I were a horse?' '

Data can't speak for itself; it's up to you to give it a voice. Try to speak truthfully.

If economists wished to study the horse, they wouldn’t go and look at horses. They’d sit in their studies and say to themselves, "what would I do if I were a horse?"

I hate when people ask me to: "Massage the data".