How status seeking may prevent Coasean bargaining

Gilles Grolleau (), Alain Marciano and Naoufel Mzoughi

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Abstract: Even in a world with zero transaction costs, status seeking can prevent efficient Coasean bargaining. Using simple illustrations and various examples, we show that ignoring this impediment can explain the failure of some negotiations where an efficient bargaining seems a priori reachable and expected. Rather than just emphasizing this neglected issue, we discuss various institutional and behavioral strategies by which this impediment can be overcome and even strategically used in socially desirable directions, such as bargaining over status.

Keywords: status seeking; market failures; Bargain; Coase; positional concerns; Externalities (search for similar items in EconPapers)
Date: 2018
Note: View the original document on HAL open archive server: https://hal.umontpellier.fr/hal-01821894v2
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Published in Review of Law and Economics, 2018, 14 (2), pp.20160036. ⟨10.1515/rle-2016-0036⟩

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Journal Article: How Status Seeking may Prevent Coasean Bargaining (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01821894

DOI: 10.1515/rle-2016-0036

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