Chicago's Best Ideas: Saul Levmore, "Coase's Legacy"
Ronald Coase (1910-2013), of Nobel Prize and University of Chicago Law School fame, influences almost every discussion in the modern law school. In this opening talk of the 2013-14 "Chicago's Best Ideas" (CBI) series, Professor Levmore begins by explaining the Coase Theorem – probably Chicago's very best and certainly best known idea – and why its appearance was so startling. The talk then moves to its present-day legacy. Is all bargaining suspect either because of wealth inequality or because of the "endowment effect" of law itself? Why don't we see more bargaining around legal rules? Is most "corruption" to be welcomed as Coasian bargaining, inasmuch as those parties are also bargaining around a rule? Is capitalism in modern China, the subject of Coase's last book, simply an example of a Coasian bargain for government itself, or at least for the prevailing economic system? Are all interest groups “just” Coasian?