Table of Contents

Institutions, Contracts and Organizations

Institutions, Contracts and Organizations

Perspectives from New Institutional Economics

Edited by Claude Ménard

This outstanding book presents new original contributions from some of the world’s leading economists including Ronald Coase, Douglass C. North, Masahiko Aoki, Oliver E. Williamson and Harold Demsetz. It demonstrates the extent and depth of the New Institutional Economics research programme which is having a worldwide impact on the economics profession.

Chapter 5: Ronald Coase and the new microeconomics

Lars Werin

Subjects: economics and finance, industrial organisation, institutional economics


Lars Werin Ronald Coase is a great economist and a great scholar. Let me begin by directly asking the questions, what makes Coase stand out as a scientist and what lies behind his achievements? I think above all the following. First, he has always refused to take anything for granted. He has a skepticism toward conventional wisdom which is both sound and productive: if facts do not accord with that wisdom, trust the facts. Then there is his insistence on what is the primary task of economists. That task, he argues, is to explain the phenomena we observe around us; making blueprints for a better economic world should wait until we know more about the world we live in. Third, he stubbornly adheres to the old principle called Occam’s Razor. No explanation, no theory should be made more complex than needed; no refinements should be added just for the sake of giving an analysis an air of profundity or technical elegance. These guiding principles have served Coase well. By so doing, we have all benefitted. There is no doubt that Coase has improved remarkably our understanding of the way the economic system works. We used to think we knew all the essential things through Léon Walras, Alfred Marshall, John Hicks, Kenneth Arrow, Gérard Debreu and Maurice Allais, to mention some major names – but this was a serious mistake. At the same time, he has provided a basis for a better understanding of the legal system as...

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information