The Modification on Coase Theorem
Anyou Wang · Ecological Economy · 2007
The Coase Theorem made many people believe that the clarification of property right can solve external problems.J.E.Stiglitz and other people questioned the Coase Theorem.After the research on Xianghuang Qi,the author found out that there existed the phenomenon of“excessive browse”during the period of collective management of the grassland,but during the private management of the grassland,there still existed“over-browse”.This challenged the Coase Theorem.The paper states that the Coase Theorem emphasized the importance of property right,and he contributed a lot,however,it had limits and needed to be modified.This paper figures out that when we solve the external problems such as“excessive browse”,the most effective way is to adopt the double-restrict mechanism of“property right-the intervention of government”and“the method of intervening before the thing happened”.