It Takes Two to Tango, Yes and A

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The idea that externalities are mutuala, this mutuality you're talking about is disturbing. It should be that the farmers should grow close to the railroad. That may be the cheapest way to get op with this problem. But at the same time, what cos forces you to acknowledge is that sometimes the morality you impose on an economic situation is false. And it's not just a different metric. It's wrong.

Don Boudreaux of George Mason University and Cafe Hayek talks with EconTalk host Russ Roberts about the intellectual legacy of Ronald Coase. The conversation centers on Coase's four most important academic articles. Most of the discussion is on two of those articles, "The Nature of the Firm," which continues to influence how economists think of firms and transaction costs, and "The Problem of Social Cost," Coase's pathbreaking work on externalities.