Restricted Coasean bargaining

MacKenzie, Ian A. and Ohndorf, Markus (2013) Restricted Coasean bargaining. Journal of Public Economics, 97 1: 296-307. doi:10.1016/j.jpubeco.2012.11.002

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Author MacKenzie, Ian A.
Ohndorf, Markus
Title Restricted Coasean bargaining
Journal name Journal of Public Economics   Check publisher's open access policy
ISSN 0047-2727
Publication date 2013-01-01
Year available 2012
Sub-type Article (original research)
DOI 10.1016/j.jpubeco.2012.11.002
Open Access Status
Volume 97
Issue 1
Start page 296
End page 307
Total pages 12
Place of publication Amsterdam, Netherlands
Publisher Elsevier
Language eng
Subject 2003 Finance
2002 Economics and Econometrics
Abstract We investigate the efficiency of Coasean bargaining when restrictions are placed on the set of feasible bargaining outcomes. When property rights are costly to (defend) appropriate, we find bargaining restrictions may be Pareto superior to unconstrainedvoluntary exchange. Under cost uncertainty over the harmful activity, we show an efficient configuration of restrictions must balance the potential reduction in appropriation costs with the possibility of allocatively inefficient bargaining restrictions. For an all-pay auction, we find conditions where precluding bargaining is always ex ante preferable to unrestricted bargaining. For cases where the restrictions are contested, we show conditions for the continuing existence of welfare improvements.
Keyword Coase theorem
Bargaining restrictions
All-pay auction
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ
Additional Notes Available online: 20 November 2012.

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2013 Collection
School of Economics Publications
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Citation counts: TR Web of Science Citation Count  Cited 2 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 2 times in Scopus Article | Citations
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Created: Wed, 21 Nov 2012, 20:52:38 EST by Alys Hohnen on behalf of School of Economics