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His second major article, The Problem of Social Cost , argued that if we lived in a world without transaction costs, people would bargain with one another to create the same allocation of resources, regardless of the way a court might rule in property disputes. Coase used the example of a nuisance case named Sturges v Bridgman, where a noisy sweetmaker and a quiet doctor were neighbours and went to court to see who should have to move. So the law ought to pre-empt what would happen, and be guided by the most efficient solution. The idea is that law and regulation are not as important or effective at helping people as lawyers and government planners believe.
Glanville Williams said that the meaning of the word “law” depends on the context in which that word is used. He said that, for example, “early customary law” and “municipal law” were contexts …