An economic principle stating that the boundaries of the firm, what it produces in-house versus what it buys from the market, are determined by comparing transaction costs.
The Coase theorem, or more precisely Coase's theory of the firm, is a principle of institutional economics drawn from two founding articles: The Nature of the Firm (1937) and The Problem of Social Cost (1960). Ronald Coase develops the idea that the boundaries of the enterprise, that is, what it produces itself versus what it buys on the market, are not arbitrary but result from a calculation minimizing transaction costs. When the costs of internalizing an activity (internal coordination, management, risks linked to specific assets, bureaucracy) exceed market costs for the same activity (negotiation, contracting, supplier failure risk), it is rational to outsource. In the reverse direction, the firm internalizes to avoid market frictions. In the context of agentic AI, Coase's thesis regains direct and radical relevance: the emergence of foundation models capable of performing complex cognitive tasks at near-zero marginal cost transforms the cost profile of many intellectual functions. Activities that once required dozens of full-time equivalents, from financial analysis to contract drafting and code auditing, can now be purchased on the market at the cost of a subscription or an API call. This transformation shifts the make-vs-buy equilibrium toward more outsourcing, but simultaneously generates a concentration risk: if all firms buy the same intelligence from the same model providers, diversification disappears and algorithmic monoculture creates systemic vulnerabilities that classical Coasian theory had not anticipated.
A reinsurance underwriting firm analyzes 500 bordereaux per month. In-house, each bordereau takes two hours of a senior analyst: total cost 50,000 euros. An AI agent processes the same volume in one hour per day: monthly cost 2,000 euros. The Coasian break-even is crossed, and human internalization is no longer rational. But if all firms adopt the same model, a flaw in that model affects the entire market simultaneously.
Coase, théorie de la firme de Coase, Coase theorem, make-or-buy, frontières de la firme