4,718 research outputs found
The Coase theorem and idea of transaction costs â their significance for the development of economics
Ronald Coase drew the attention of main stream economists to the significance of social coordination in the economic system. The key role was played here by much-disputed political conclusions drawn from Coase's idea as well as by his famous theorem and the zero transaction costs theory. The study focuses on the division of labor as a starting point for analysis of zero transaction costs. From this vantage point, the best example of the world of zero transaction costs is Robinson Crusoe's island. However, very often the concept of zero transaction costs is associated with the assumption of perfect information. If we stretch this assumption to its logical limits, then there is no market mechanism and all impediments related to the central planning system disappear. This interpretation is in line with the Hayekian interpretation of the market as a mechanism for acquiring knowledge.Ronald Coase skierowaĆ uwagÄ ekonomistĂłw gĆĂłwnego nurtu na znaczenie spoĆecznej koordynacji w systemie ekonomicznym. KluczowÄ
rolÄ odegraĆy tu zarĂłwno kontrowersyjne wnioski polityczne wyprowadzane z idei Coase'a, jak i sĆynny teoremat i koncepcja zerowych kosztĂłw transakcji. W artykule uwaga skoncentrowana jest na podziale pracy jako punkcie wyjĆcia do analizy zerowych kosztĂłw transakcji. Z tego punktu widzenia najlepszym przykĆadem Ćwiata zerowych kosztĂłw transakcji jest wyspa Robinsona. NajczÄĆciej jednak koncepcja zerowych kosztĂłw transakcji wiÄ
zana jest z zaĆoĆŒeniem doskonaĆej informacji. JeĆŒeli zaĆoĆŒenie to doprowadzamy do jego logicznych granic nie ma mechanizmu rynkowego oraz znikajÄ
wszelkie trudnoĆci systemu centralnego planowania. Ta interpretacja jest zbieĆŒna z hayekowskÄ
interpretacjÄ
rynku jako mechanizmu odkrywania wiedzy
The cost and benefits of collective bargaining : a survey
Collective bargaining and dispute resolution mechanisms facilitate coordination. Coordination is increasingly seen as an influential determinant of labor market and macroeconomic performance. This paper provides a systematic review of the relevant literature with a specific focus on the role that collective bargaining plays in shaping macroeconomic performance. We focus on comparative studies of labor market institutions in the OECD area that try to disentangle the impact of different institutional approaches to collective bargaining from other determinants of macroeconomic performance.Environmental Economics&Policies,Economic Theory&Research,Labor Management and Relations,Social Protections&Assistance,Labor Standards
Externalities and the Allocation of Decision Rights in the Theory of the Firm
This paper views authority as the right to undertake decisions that have external effects on other members of the organization. Because of contractual incompleteness, monetary incentives are insufficient to internalize these effects in the decision makerâs objective. The optimal assignment of decision rights minimizes the resulting inefficiencies. We illustrate this in a principalâagent model where the principal retains the authority to select âlargeâ projects but delegates the decision right to the agent to implement âsmallâ projects. Extensions of the model discuss the role of effort incentives, asymmetric information and multistage decisions
Y2K and Offshoring: The Role of External Economies and Firm Heterogeneity
We construct a model of offshoring with externalities and firm heterogeneity. Due to the presence of externalities, temporary shocks like the Y2K problem can have permanent effects, i.e., they can permanently raise the extent of offshoring in an industry. Also, the initial advantage of a country as a potential host for outsourcing activities can create a lock in effect, whereby late movers have a comparative disadvantage. Furthermore, the existence of firm heterogeneity along with externalities can help explain the dynamic process of offshoring, where the most productive firms offshore first and the others follow later. Finally, we show the possibility of complementarity between two modes of offshoring: FDI and offshore outsourcing.
Plaintiffs exploiting Plaintiffs
We consider a model of a single defendant and N plaintiffs where the total cost of litigation is fixed on the part of the plaintiffs and shared among the members of a suing coalition. By settling and dropping out of the coalition, a plaintiff therefore creates a negative externality on the other plaintiffs. It was shown in Che and Spier (2007) that failure to internalize this externality can often be exploited by the defendant. However, if plaintiffs make sequential take-it-or-leave-it settlement offers, we can show that they will actually be exploited by one of their fellow plaintiffs rather than by the defendant. Moreover, if litigation is a public good as is the case in shareholder derivative suits, parties may fail to reach a settlement even having complete information. This may explain why we observe derivative suits in the US but not in Europe
For Whom is MAI? A theoretical Perspective on Multilateral Agreements on Investments
Why do we observe some LDCs objecting the prospect of a Multilateral Agreement on Investment (MAI), although they have been keen to liberalize investment in preferential agreements in recent years? In this paper, we analyse the issue of MAI implementation and assess the welfare consequences of such kind of agreements. In our model, participation to MAI involves a trade-off between less rent extraction from multinational firms (MNEs) and more abundant FDI inâĄows. At equilibrium, either all countries enter MAI, or all countries stay out, or only some of them enter. Coordination problems may induce multiple equilibria: the three types of equilibria may coexist. So, the implementation of MAI may depend not only on structural factors but also on the general âpolitical climateâ. When all countries join MAI, world welfare is maximized because this minimizes the hold-up problem faced by MNEs and stimulates investment. However, in an asymmetric world, welfare gains are not guaranteed for all countries.Foreign Direct Investment, International Agreements, Incomplete
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