If I had known as much mathematics as you, I would have become a chemist

The below is part 1 of an Oliver Hart lecture (from earlier this year) on reference points and the theory of the firm (here’s the associated Economica piece, and the QJE article).  After Coase saw Hart present the first time, sometime in the 90s, he told Hart “If I had known as much mathematics as you, I would have become a chemist.”  It wasn’t a compliment.  Coase does not think much of formal approaches in economics.


One Comment on “If I had known as much mathematics as you, I would have become a chemist”

  1. stevepostrel says:

    It’s interesting. In Part 2 of the video, Hart misstates the Coase theorem, claiming that it says that bargaining costs are zero. Of course, that’s not what Coase wrote or had in mind at all–he was at pains to show the importance of bargaining costs by pointing out that in their absence resource allocations weren’t affected by the assignment of property rights–a highly counterintuitive result that most readers would have taken as a reductio ad absurdum. He put in the “absurd” result to try to force economists to pay attention to bargaining costs. But I’ve seen interpretations like Hart’s many times over the years. It seems Coase was too subtle and implicit in making his points.

    The evaluation of Coase’s rhetorical strategy therefore is “epic fail,” except for that part about winning the Nobel. Perhaps being widely misunderstood is the price of high citation counts. (Being narrowly misunderstood is the price of low citation counts.)


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