For this month’s discussion meetup, which so happens to fall on Valentine’s Day, we will discuss a very romantic topic: transaction costs! The main reading will be Ronald Coase’s classic article “The Nature of the Firm” which asks why people organize into firms and hire employees rather than just hiring contractors. Coase’s insight is that contracting involves a lot of transaction costs — not just literal dollars, but negotiation, contract enforcement, difficulty communicating, etc.
The suggested reading includes the original Coase paper as well as some podcast discussions and a short video summarizing the key ideas.
As always, feel free to come if you haven’t done the reading.
READINGS & MEDIA
- “The Nature of the Firm” by Ronald Coase
- Essential Coase: Why do Firms Exist? (Short YouTube explainer)
- Ronald Coase on EconTalk (at age 92!)
- Michael Munger on the Nature of the Firm on EconTalk
DATE & LOCATION
- Date: Saturday, 2/14 @ 2pm–4:30pm
- Location: South Loop Strength & Conditioning – upstairs in the mezzanine 645 S Clark Chicago IL 60605
- Note: Todd owns this gym so that’s why there’s a Rationality meetup at a gym 🙂
- Another note: The gym is cold in the winter, please bring layers!