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An Abolitionist Reading of Ronald Coase’s “The Problem of Social Cost"

Updated: Dec 24, 2022

In her widely acclaimed book published in 2003, political activist Angela Davis asked, “Are Prisons Obsolete?” Her words accompanied a wider chorus of activists, who in their aims to end mass incarceration, demanded for a change in approach to how society views crime, punishment, and community. This world is a world that decouples the racism and white supremacy that is argued to be intrinsic in the American penal system. It is a world in which prisons do not exist, and as such give’s individuals access to knowledge and tools to resolve conflicts without always resorting to policing and legal arbitration. Like Angela Davis, many people have endeavored to formalize their own theories in favor of the aforementioned vision and provide their own answers to “Are Prisons Obsolete?” One unlikely response can be found in the highly acclaimed article “The Problem of Social Cost” (1960) by economist Ronald Coase. Following the lead of many abolitionists, Ronald Coase’s article is an exercise in imagining a new world and a change in approach to the status quo. Embedded in his arguments on how economics could be used as a mode of analysis for adjudication, is an image of a world that echoes that of a modern-day prison activist. The aim of this essay is not to argue that Ronald Coase is a prison abolitionist, but rather to explore the salience of Coase's arguments, namely the Coase Theorem and Coase’s views on the delimitation of rights, as both an economic and abolitionist exercise. Specifically centering the analysis within Section VI and VII of his essay, this essay will argue that the change in approach to adjudication that he highlights is one that can contribute to current discussions on prison abolition and perhaps add a more economic framework that is often missing within modern conversations of prison abolition.

To begin, it is important to note that prison abolitionist rhetoric is distinctly tied to the court system and American judicial practices. Discussions on mass incarceration are often also discussions on over-policing (especially in lower socioeconomic communities) and overcrowding of courts. Prison abolitionists are very concerned with prison sentencing and argue against the unpredictability, and at times, the arbitrary nature of criminal sentencing. The abolition framework is also one that is very critical of the way that judges make decisions and as such with the abolition of prison also comes the lessened reliance on faulty judicial authority/legislation on criminality. In “The Problem of Social Cost”, Coase abstracts from discussing crime per se, and speaks to a broader notion of harm and costs[1]. It is these two ideas that undergird his analysis and speak to the ethos of abolition.