He was the Clifton R. Musser Professor of Economics at the University of Chicago Law School, where he arrived in 1964 and remained for the rest of his life.

[1] Coase believed economists should study real-world wealth creation, in the manner of Adam Smith, stating, "It is suicidal for the field to slide into a hard science of choice, ignoring the influences of society, history, culture, and politics on the working of the economy.

Additionally, Coase's transaction costs approach has been influential in modern organizational economics, where it was re-introduced by Oliver E. Williamson.

Coase settled at the University of Chicago in 1964 and became the co-editor of the Journal of Law and Economics with Aaron Director.

Nearing his 100th birthday, Coase was working on a book concerning the rise of the economies of China and Vietnam.

[17] Coase married Marian Ruth Hartung of Chicago, Illinois in Willesden, England, 7 August 1937.

[6] Although they were unable to have children, they were married 75 years until her death on 17 October 2012, making him one of the longest-married Nobel Prize laureates.

This argument sets the stage for the later contributions by Oliver Williamson: markets and hierarchies are alternative co-ordination mechanisms for economic transactions.

A further exploration of the dichotomy between markets and hierarchies as co-ordination mechanisms for economic transactions derived a third alternative way called Commons based peer production, in which individuals successfully collaborate on large-scale projects following a diverse cluster of motivational drives and social signals.

Upon publishing his article The Federal Communications Commission in 1959, Coase received negative feedback from the faculty at the University of Chicago over his conclusions and apparent conflicts with A. C. Pigou.

According to Coase, "What I said was thought to run counter to Pigou's analysis by a number of economists at the University of Chicago and was therefore, according to them, wrong.

Coase had presented his paper in 1960 during a seminar in Chicago, to twenty senior economist including George Stigler and Milton Friedman.

He gradually won over the usually skeptic audience, in what has later been considered a "paradigm-shifting moment" in the genesis of Chicago Law and Economics.

Coase argued that without transaction costs the initial assignment of property rights makes no difference to whether or not the farmer and rancher can achieve the economically efficient outcome.

If transaction costs were zero (as is assumed in standard economic theory) we can imagine people contracting around the law whenever the value of production would be increased by a change in the legal position.

I pointed out that the judges in their opinions often seemed to show a better understanding of the economic problem than did many economists even though their views were not always expressed in a very explicit fashion.

[28]Despite wandering accidentally into law and economics, the opportunity to edit the Journal of Law and Economics was instrumental in bringing him to the University of Chicago: [W]hen I was approached to fill Aaron Director's place on his retirement, what I found most attractive about coming to Chicago was the opportunity it gave me of editing the Journal.

What I wanted to do was to encourage the type of research which I had advocated in 'The Problem of Social Cost', and I used my editorship of the Journal as a means of bringing this about.

But it can hardly be denied that in the emergence of the subject of law and economics, Chicago has played a very significant part and one of which the University can be proud.

The theorem states that if trade in an externality is possible and there are sufficiently low transaction costs, bargaining will lead to a Pareto efficient outcome regardless of the initial allocation of property.

Abba Lerner, a fellow student and a fine theorist, with whom I had a very friendly relation, also believed in the virtues of a competitive system but was even more attached to Socialism than I was.

[27]Guido Calabresi wrote that Coase's focus on transaction costs in The Nature of the Firm was the result of his socialist beliefs.

Coase continued: My socialist sympathies gradually fell away and this process was accentuated as a result of being assigned in 1935 at LSE the course on the Economics of Public Utilities.

I soon found out that very little was known about British public utilities and I set about making a series of historical studies on the water, gas, and electricity supply industries and of the Post Office and broadcasting.

[27]Coase was research advisor to the Ronald Coase Institute, an organisation that promotes research on institutions and organizations – the laws, rules, customs, and norms – that govern real economic systems, with particular support for young scholars from developing and transitional countries.