What is the field where Coase reintroduced transaction cost theory?
Macroeconomics
Econometrics
Organizational Economics
Psychological Economics
Answer
Transaction cost theory, as reintroduced by Coase in the field of organizational economics, offers a framework for understanding why firms exist. It suggests that firms emerge when the costs of transacting in the market (transaction costs) exceed the costs of organizing production within a firm. Transaction costs include costs of searching for and negotiating contracts, as well as costs of monitoring and enforcing contracts.
Coase's Economic Conundrums: Unraveling the Legacy of a Nobel Laureate
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