Bargaining in the Absence of Property Rights: An Experiment
Oren Bar-Gill and
Christoph Engel
Journal of Law and Economics, 2016, vol. 59, issue 2, 477 - 495
Abstract:
The Coase theorem posits that if (1) property rights are perfect, (2) contracts are perfectly enforceable, (3) transaction costs are zero, (4) preferences are common knowledge, and (5) parties are rational, then the initial allocation of entitlements matters only for distribution, not for efficiency. We study, in an experimental setting, whether condition 1 is necessary. Our results suggest that property rights have a limited effect on efficiency.
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:ucp:jlawec:doi:10.1086/687411
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