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The problem of social cost: the role of the state

The problem of social cost: the role of the state This essay presents a theory of the State as derived from the writings of Coase, Stigler, and Smith. It argues that the state may find a role in (1) lowering the level of transactions costs; and (2) redistributing property rights given the level of non‐zero transactions costs. These tenets suggest an explanation for the secular growth of government. Also, alternative to the Marshallian theory of differing marginal utilities of a dollar of income, the essay offers a more general theory of redistribution in a way consistent with Coase’s (1992) concept of a transactions‐cost‐based, more general, price theory. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Social Economics Emerald Publishing

The problem of social cost: the role of the state

International Journal of Social Economics , Volume 26 (5): 7 – May 1, 1999

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References (18)

Publisher
Emerald Publishing
Copyright
Copyright © 1999 MCB UP Ltd. All rights reserved.
ISSN
0306-8293
DOI
10.1108/03068299910215898
Publisher site
See Article on Publisher Site

Abstract

This essay presents a theory of the State as derived from the writings of Coase, Stigler, and Smith. It argues that the state may find a role in (1) lowering the level of transactions costs; and (2) redistributing property rights given the level of non‐zero transactions costs. These tenets suggest an explanation for the secular growth of government. Also, alternative to the Marshallian theory of differing marginal utilities of a dollar of income, the essay offers a more general theory of redistribution in a way consistent with Coase’s (1992) concept of a transactions‐cost‐based, more general, price theory.

Journal

International Journal of Social EconomicsEmerald Publishing

Published: May 1, 1999

Keywords: Economic theory; Government; Property rights; Transactions costs

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