Axel Gosseries wrote:
>Fascinating. My curiosity is about the exact analytical step that 
>did the work. We shifted from administrative restrictions to 
>property rights. What triggered this shift? Is it the fact that 
>imagining that these things could be traded, it would begin to make 
>sense to present them as property rights rather than administrative 
>restrictions? Or is it the reverse?
>
>I guess what I should try and do is follow the idea from Sidgwick, 
>Pigou, Knight to Coase, right?


Since you asked, I don't think it's that clean -- there isn't an "exact 
analytical step."  The names you mention are, of course, important, but so are 
Demsetz, Alchian and others.  In terms of actual policy, explaining the rise of 
things like bubbles and marketable permits would have to include the 
changing political background. It seems to me a good topic to work and write on.

If you are looking for the source of Coase's insight, here's another 
quotation from Kitch:


LANDES: Ronald, you mentioned Frank Knight's Risk, Uncertainty and
Profit as an important influence on your work. One of Knight's papers
that has been most influential in the recent law and economics area is his
paper, "Some Fallacies in the Interpretation of Social Cost."64 That was
in some ways a forerunner of your paper on social cost because it spells
out the importance of property rights in resource allocation, and I wonder
if you were familiar with Knight's article?
COASE: Oh, yes. In fact, I would say that the title of my paper came
from Frank Knight, and the title of the paper was rather to indicate the
topic I was talking about, because, of course, I don't think the concept of
social cost is a very useful one, and I don't ever refer to it. But it did
indicate to people what I was talking about. I knew it, and if there are
traces of what Knight says in my work, it wouldn't surprise me.
FRIEDMAN: It would surprise you if there weren't, wouldn't it?
COASE: Yes, that's right.

64 Frank H. Knight, Some Fallacies in the Interpretation of Social 
Cost, Q. J. Econ.
(1924), reprinted in Readings in Price Theory (George J. Stigler & 
Kenneth Boulding eds.
1952).

[I said 1926 in my previous email, but Knight's Fallacies article, 
also in JSTOR, is 1924.]


BTW, McCloskey's So-called Coase Theorem and Actual Coase Theorem makes 
sense to me. In class, I use the terms Simple Coase and Complex Coase. 
Non-zero TC is definitely where the real Coase is at.

Humberto Barreto