The Paradox of Coase as a Defender of Free Markets
The Ronald Coase of The Problem of Social Cost is viewed by virtually all economists as a staunch defender of free markets. Part of the reason for this might be the fact that in his other works he did indeed take this position. For example, not only did Coase claim that lighthouses had been privately run, he was happy to present it in this manner. And this free enterprise perspective applies, too, to his analyses of radio frequencies and his treatment of advertising, to say nothing of his analysis of the post office. Further, his work was a ringing endorsement of free speech. But this notion that Coase in The Problem of Social Cost may be counted as a supporter of the market has not gone unchallenged. Critics of Coase on these grounds include Block, Cordato, Krecke, North, and Rothbard. In the present paper, we challenge this mainstream Coase-as-free-enterpriser view by considering several cases in point.
