The article compares the views of Coase and Pigou on external effects in economics. Coase focuses on total efficiency, while Pigou leans towards marginal efficiency through taxes or liability. Coase criticizes Pigou's approach and argues for a more reciprocal solution to externalities. Coase's famous theorem states that public intervention isn't always needed for efficiency when transaction costs are low. However, Coase rejects Pigou's methods entirely, even when transaction costs are high. This leads to a debate on compensating victims and strict liability rules in economic policies.