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In simple terms, it means "build a better mousetrap, and the world will beat a path to your door," no matter who or where you are.
<center>''The Coase theorem is very powerful for debunking excuses, and for recognizing the enormous opportunities available to all regardless of wealth''.</center>
<center>''The Coase theorem is very powerful for debunking excuses, and for recognizing the enormous opportunities available to all regardless of wealth''.</center>
The '''Coase theorem''' states that if property rights are well-defined and [[transaction costs]] (including costs of negotiating) are zero or negligible, then the most efficient or [[Pareto optimal]] economic activity will occur regardless of who initially owns the property rights. Negotiation and market transactions will ensure optimal allocation of property.
The '''Coase theorem''' states that if property rights are well-defined and [[transaction costs]] (including costs of negotiating) are zero or negligible, then the most efficient or [[Pareto optimal]] economic activity will occur regardless of who initially owns the property rights. Negotiation and market transactions will ensure optimal allocation of property. Simply put, it means "build a better mousetrap, and the world will beat a path to your door,"<ref>The phrase is attributed to [[Ralph Waldo Emerson]], who said something similar.</ref> no matter who or where you are.
This simple theorem, first published in a 1960 paper<ref>Ronald H. Coase, “The Problem of Social Cost,” 3 J. Law & Econ. 1 (1960)</ref> by [[Ronald Coase]] who won the Nobel Prize for Economics for this in 1991, has powerful implications for economics, law, politics, and even Christianity. This theorem supports conservative interpretations of the [[Chicago School of Economics]].
This simple theorem, first published in a 1960 paper<ref>Ronald H. Coase, “The Problem of Social Cost,” 3 J. Law & Econ. 1 (1960)</ref> by [[Ronald Coase]] who won the Nobel Prize for Economics for this in 1991, has powerful implications for economics, law, politics, and even Christianity. This theorem supports conservative interpretations of the [[Chicago School of Economics]].