Update, Sept. 4: We added the audio for David Kestenbaum's radio obituary of Ronald Coase.
If you created the world as a simple economic thought experiment, companies wouldn't exist. Instead, everybody would work for themselves, and they'd be constantly selling their labor (or the fruits of their labor, or use of their tools, or whatever) to the highest bidder. Wages would rise and fall every day (every hour! every second!) depending on supply and demand. That's how the market works, after all.
Three previous Peace Prize laureates "South African Archbishop Desmond Tutu, Mairead Maguire of Northern Ireland and Adolfo Perez Esquivel from Argentina, have demanded that the prize money of $1.2 million not be paid this year. They say the bloc contradicts the values associated with the prize because it relies on military force to ensure security."
Originally published on Mon October 15, 2012 12:34 pm
For economists, prices are like magic. They send all kinds of signals about who wants what, and how badly they want it. Prices are what make markets work so well in so many settings.
But there are some things we don't want to put prices on. We don't pay organ donors. Children attend public high schools for free. Medical residents get paid a fixed stipend no matter where they do their hospital training.