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Smart contracts and the Coase conjecture

Thomas Brzustowski, Alkis Georgiadis Harris and Balázs Szentes

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper reconsiders the problem of a durable-good monopolist who cannot make intertemporal commitments. The buyer’s valuation is binary and his private information. The seller has access to dynamic contracts and, in each period, decides whether to deploy the previous period’s contract or to replace it with a new one. The main result of the paper is that the Coase Conjecture fails: the monopolist’s payoff is bounded away from the low valuation irrespective of the discount factor

JEL-codes: D42 D82 D86 L12 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2023-05-01
New Economics Papers: this item is included in nep-com, nep-hpe and nep-mic
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Published in American Economic Review, 1, May, 2023, 113(5), pp. 1334 - 1359. ISSN: 0002-8282

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