THE COASE THEOREM AND THE DIVISION OF ACADEMIC LABOR

The extensive research in ''transaction cost economics'' motivated by the work of Ronald Coase seems to take place mostly in business and la w schools and not in traditional economics departments where the vast majority of economists practice and the next generations are trained. This paper examines why the Coase program has not revolutionized econo mics. First, it reflects the unwillingness of Coase to use mathematica l tools or the Walrasian paradigm. Second, the clientele of profession al schools are less willing to tolerate abstraction acceptable to thos e of the economics departments. But the continuation of such division will hinder the quest for understanding economic life.