WHEN COASE ARGUED THAT AUCTIONING VALUABLE GOVERNMENT RIGHTS WAS NOT LAUGHABLE.

WHEN COASE ARGUED THAT AUCTIONING VALUABLE GOVERNMENT RIGHTS WAS NOT LAUGHABLE. The Coase Theorem can be thought of as a statement that the possibility of market solutions should always be considered even if transaction costs eventually rule market solutions out. As I posted on here, there was a time when Coase’s arguments seemed ridiculous. Fifty years ago, radio and television licenses were awarded by the government on the basis of “merit”. A federal agency decided contests between groups of worthy citizens to determine which group was most worthy to receive a bonanza. As I posted, when Professor Coase proposed that the government use auctions to allocate radio spectrums, “a commissioner of the Federal Communications Commission jeered the idea, asking, ‘Professor, is this all a big joke?’”

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