The Problem of Social Cost

  title={The Problem of Social Cost},
  author={Ronald H. Coase},
  journal={The Journal of Law and Economics},
  pages={1 - 44}
  • R. Coase
  • Published 1 October 1960
  • Economics
  • The Journal of Law and Economics
THIS paper is concerned with those actions of business firms which have harmful effects on others. The standard example is that of a factory the smoke from which has harmful effects on those occupying neighbouring properties. The economic analysis of such a situation has usually proceeded in terms of a divergence between the private and social product of the far' ory, in which economists have largely followed the treatment of Pigou in The Economics of Welfare. The conclusions to which this kind… Expand
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Mishan, The Meaning of Efficiency in Economics, 189
  • The Bankers' Magazine
  • 1960