In a market, there is always a feedback mechanism between producers and consumers, which runs obviously through the payment of money. By indicating the price they are willing to pay, consumers signal to producers the quantity of the good they wish to have supplied, and producers happily concur, since through the transfer of money the interests of the consumers have become their own. Ronald Coase (1960) in The Problem of Social Cost showed that all externality issues can be reduced to market transaction costs. The higher these costs, the higher will be the level of external or social costs. While this was undoubtedly a major conceptual insight, stating that transaction costs cause social costs does not say all that much.