Evidence item

A Northwestern lecture summarizes Coasean firms as economizing on coordination costs, with scope determined at the margin by organizing costs. DIRECT_TEXT

Authenticity UNVERIFIED · extraction UNVERIFIED · independence group none (unreviewed) · created seq 10504

Source: Coase: The Nature of the Firm · locator {} · excerpt hash sha256:cac2ebc76b4db7ae023e1de753bbcdd082af08ca56a466c1a782de3cd47eee09

Firms exist to economize on the cost of coordinating economic activity. ... What limits the scope of the firm? - increasing marginal costs of organizing more transactions within the firm. ... So the scope of the firm is determined at the margin.