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Of Posin And Pigs, Of Coase And Cost, Of Profits Gained And Opportunities Lost, Stephen G. Marks
Of Posin And Pigs, Of Coase And Cost, Of Profits Gained And Opportunities Lost, Stephen G. Marks
Faculty Scholarship
In his article, "The Coase Theorem: If Pigs Could Fly," Professor Daniel Posin purports to demonstrate that the Coase Theorem fails because it incorrectly accounts for opportunity costs. This short paper will demonstrate that there is a mistake in the example Posin uses to prove his assertion. Although the mistake is a small one, it completely drives his result. In fact, after correcting the mistake, Posin's example corroborates, rather than refutes, the Coase Theorem.