The greater the uncertainties of the world, the greater is the possibility that profits would go to venturesome and lucky rather than to logical, car… - Armen Alchian

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The greater the uncertainties of the world, the greater is the possibility that profits would go to venturesome and lucky rather than to logical, careful, fact-gathering individuals.

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About Armen Alchian

Armen Albert Alchian (April 12, 1914 – February 19, 2013) was an American economist and an Emeritus Professor of Economics at the University of California, Los Angeles. He was the founder of the "UCLA tradition" in economics, a member of the Chicago school of economics, and one of the more prominent price theorists of the second half of the 20th century.

Also Known As

Native Name: Armen Albert Alchian
Alternative Names: Armen A. Alchian
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The mark of a capitalistic society is that resources are owned and allocated by such nongovernmental organizations as firms, households, and markets. Resource owners increase productivity through cooperative specialization and this leads to the demand for economic organizations which facilitate cooperation. When a lumber mill employs a cabinetmaker, cooperation between specialists is achieved within a firm, and when a cabinetmaker purchases wood from a lumberman, the cooperation takes place across markets (or between firms). Two important problems face a theory of economic organization—to explain the conditions that determine whether the gains from specialization and cooperative production can better be obtained within an organization like the firm, or across markets, and to explain the structure of the organization.

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By this I refer to the fact that at the same time several people may each possess some portion of the rights to use the land. A may possess the right to grow wheat on it. B may possess the right to walk across it. C may possess the right to dump ashes and smoke on it. D may possess the right to fly an airplane over it. E may have the right to subject it to vibrations consequent to the use of some neighboring equipment. And each of these rights may be transferable. In sum, private property rights to various partitioned uses of land are "owned" by different persons.

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