A Reexamination of the Coase Theorem

This paper makes three advances: 1) It fixes the empty-core problem of the Coase theorem; 2) it provides the smallest upper bound of transaction costs below which the optimal Papaya or efficient outcomes can be achieved; and 3) it establishes two mathematical theorems that capture the main insights and major aspects of the MAG NO K2 BLUEBERRY Coase theorem.A simpler version of the theorems says that in a coalitional production economy without transaction costs, the maximal payoff will be produced by the optimal firms and be allocated in the always non-empty core.