Property rights in sequential exchange
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- dc.contributor.author Arruñada, Benitoca
- dc.contributor.author Zanarone, Giorgioca
- dc.contributor.author Garoupa, Nunoca
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2018-02-14T15:29:51Z
- dc.date.available 2018-02-14T15:29:51Z
- dc.date.issued 2018
- dc.date.modified 2018-02-14T15:29:33Z
- dc.description.abstract We analyze the “sequential exchange” problem in which traders have imperfect information on earlier contracts. We show that under sequential exchange, it is in general not possible to simultaneously implement two key features of markets—specialization between asset ownership and control, and impersonal trade. In particular, we show that in contrast with the conventional wisdom in economics, strong property rights—enforceable against subsequent buyers—may be detrimental to impersonal trade because they expose asset buyers to the risk of collusive relationships between owners and sellers. Finally, we provide conditions under which a mechanism that overcomes the tradeoff between specialization and impersonal trade exists. We characterize and discuss such mechanism. Our results provide an efficiency rationale for how property rights are enforced in business, company and real estate transactions, and for the ubiquitousness of “formalization” institutions that the literature has narrowly seen as entry barriers.en
- dc.format.mimetype application/pdfca
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1588
- dc.identifier.citation
- dc.identifier.uri http://hdl.handle.net/10230/33869
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1588
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword Property rights
- dc.subject.keyword Enforcement
- dc.subject.keyword Contracts
- dc.subject.keyword Incomplete information
- dc.subject.keyword Impersonal exchange
- dc.subject.keyword Business Economics and Industrial Organization
- dc.title Property rights in sequential exchangeca
- dc.title.alternative
- dc.type info:eu-repo/semantics/workingPaper