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European Journal of Law and Economics

, Volume 11, Issue 1, pp 23–28 | Cite as

The Coase Theorem, Private Information, and the Benefits of Not Assigning Property Rights

  • Patrick W. Schmitz
Article

Abstract

Using a simple bilateral trading example with discrete valuations and costs it is demonstrated that in the presence of private information the efficiency of Coasean bargaining may be strictly enhanced if initially no property rights are assigned.

Property rights bargaining private information Coase theorem 

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Copyright information

© Kluwer Academic Publishers 2001

Authors and Affiliations

  • Patrick W. Schmitz
    • 1
  1. 1.Department of Law and Economics, Wirtschaftspolitische AbteilungUniversity of BonnBonnGermany

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