The Coase theorem in tenant protection

The Coase theorem has been receiving comments suggesting restraints on its extensive application to real life problems. This paper counters these suggestions and points out the relevance of the theorem for real life problems in its application to tenant protection. In contrast to the general view of the protection, this paper shows the protection, viewed as a realignment of the property rights, to be basically neutral and to be possibly Pareto-improving when the postulates of the theorem are not satisfied. The hold-up problem and risk aversion are invoked to show the latter.