The Coase theorem holds that in the absence of transaction costs, all allocations of property are equally efficient because affected parties will privately bargain to correct any externality. The familiar rejoinder by people who don't like law and economics is that transaction costs are never zero--but that was exactly Coase's point. Since transaction costs distort or shape virtually all outcomes, effective social policy depends upon our understanding of real world contexts. In short, the natural upshot of the Coase theorem is a comprehensive empirical research agenda on a wide range of legal and nonlegal disputes--enough work to keep several generations of researchers busy. (Granted, those of us without a Nobel Prize under our belt have been somewhat slow to catch on.)
With this understanding of Coase in mind, this paper by Barak Richman (Duke Law) and Jeffrey Macher (Georgetown Business) caught my eye: Transaction Costs Economics: An Assessment of Empirical Research in the Social Sciences. Here is the SSRN abstract:
This paper provides a comprehensive review of the empirical literature in transaction cost economics (TCE) across multiple social science disciplines and business fields. We show how TCE has branched out from its economic roots to examine empirical phenomena in several other areas. We find TCE is increasingly being applied not only to business-related fields such as accounting, finance, marketing, and organizational theory, but also to areas outside of business including political science, law, public policy, and agriculture and health. With few exceptions, however, the use of TCE reasoning to inform empirical research in these areas is piecemeal. We find that there is considerable support of many of the central tenets of TCE, but we also observe a number of lingering theoretical and empirical issues that need to be addressed. We conclude by discussing the implications of these issues and outlining directions for future theoretical and empirical work.