Pronunciation: [kˈə͡ʊs] (IPA) 
The word "COASE" is spelled as /kəʊz/. In phonetic transcription, it begins with the sound /k/ followed by the vowel sound /əʊ/, which is pronounced like the word "owe". The final sound is /z/, which is a voiced sibilant sound similar to the letter "s" in the word "zip". The spelling of the word "COASE" does not follow the typical English language conventions, as it is a proper noun derived from the economist Ronald Coase.
Coase refers to the Coase Theorem, which is an economic concept named after British economist Ronald Coase. The Coase Theorem is a proposition that explains the allocation of resources and the resolution of disputes in the presence of externalities. It suggests that in the absence of transaction costs, individuals will negotiate and bargain with one another to efficiently allocate resources.
According to the Coase Theorem, when economic agents are affected by externalities, they can reach an efficient outcome regardless of how property rights are initially assigned. The key assumption is that there are no transaction costs, implying that individuals can freely negotiate and make agreements. This theorem challenges the traditional view that the government needs to intervene to solve problems related to externalities.
The Coase Theorem argues that private parties can resolve externalities if property rights are clearly defined and negotiations are costless. In other words, when faced with an externality, the involved parties can internally negotiate the optimal solution without external interference. This negotiation ensures an efficient allocation of resources, as parties will engage in a mutually beneficial exchange.
Overall, Coase is both the name of the economist who formulated the Coase Theorem and the shorthand term for this important economic concept. It highlights the role of negotiation and private bargaining in resolving externalities and achieving Pareto efficiency, assuming there are no transaction costs.
