Coase on Lawyers, Transaction Costs and Society

From a 1997 interview with the late Ronald Coase in Reason:

Reason: Some people would say that it’s just paper transactions, that all the efforts of the lawyers are a waste, a mess, a scourge on society. You have a slightly different view.
 
Coase: Lawyers do a lot of harm, but they also do an immense amount of good. And the good is that they are expert negotiators, and they know what is necessary in the law to enable deals to be made. Their activities are designed, in fact, to lower transaction costs. Some of them, we know, raise transaction costs. But by and large, they are engaged in lowering transaction costs. People talk about the information age and how large numbers of people are engaged in information activities. Well, gathering information is one of the difficulties when you’re in a market. What is being produced, what are the prices of what is being offered? You’ve got to learn all these things. You can learn them now a good deal more easily than you could have done before; you don’t have to search. If you’ve ever tried to buy anything, you know how much time goes into finding out what’s available and all the alternatives.

Worthwhile reading.