Transaction Costs

The costs of using markets or legal institutions, including search, bargaining, drafting, monitoring, enforcement, and dispute resolution costs.

Why It Matters

Transaction-cost reasoning helps compare firms, contracts, markets, regulation, and courts as alternative governance mechanisms.

A short list of directly relevant archive entries.

1937

Introductory

Ronald H. Coase

Economica

1960

Introductory

Ronald H. Coase

Journal of Law and Economics

1979

Advanced

Oliver E. Williamson

Journal of Law and Economics

1991

Advanced

Douglass C. North

Journal of Economic Perspectives

1879

Foundations of Law and Economics

11 Ch. D. 852 (1879)

Nuisance, coming to the nuisance, and reciprocal conflicts over incompatible land uses.

1854

Foundations of Law and Economics

9 Exch. 341, 156 Eng. Rep. 145 (1854)

Foreseeability, information disclosure, and limits on consequential damages for breach of contract.

1996

Financial Law

518 U.S. 839 (1996)

Government contractual commitments made during thrift supervisory mergers and later regulatory change.