Incomplete contracts and the problem of social harm
Autor(a) principal: | |
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Data de Publicação: | 2000 |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional do FGV (FGV Repositório Digital) |
Texto Completo: | http://hdl.handle.net/10438/12300 |
Resumo: | We construct a model in which a first mover decides on its location before it knows the identity of the second mover; joint location results in a negative extemality. Contracts are inherently incomplete since the first mover's initial decision cannot be specified. We analyze several kinds of rights, including damages, injunctions, and rights to exclude (arising from covenants or land ownership). There are cases in which allocating any of these basic rights to the first mover-i.e., first-party rights-is dominated by second-party rights, and cases in which the reverse is true. A Coasian result (efficiency regardless of the rights allocation) only holds under a limited set of conditions. As corollaries of a theorem ranking the basic rights regimes, a number of results emerge contradicting conventional wisdom, including the relative inefficiency of concentrated land ownership and the relevance of the generator's identity. We conclude with a mechanism and a new rights regime that each yield the first best in all cases. |
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Pitchford, RohanEscolas::EPGEFGV2014-10-31T11:06:54Z2014-10-31T11:06:54Z2000-08-24http://hdl.handle.net/10438/12300We construct a model in which a first mover decides on its location before it knows the identity of the second mover; joint location results in a negative extemality. Contracts are inherently incomplete since the first mover's initial decision cannot be specified. We analyze several kinds of rights, including damages, injunctions, and rights to exclude (arising from covenants or land ownership). There are cases in which allocating any of these basic rights to the first mover-i.e., first-party rights-is dominated by second-party rights, and cases in which the reverse is true. A Coasian result (efficiency regardless of the rights allocation) only holds under a limited set of conditions. As corollaries of a theorem ranking the basic rights regimes, a number of results emerge contradicting conventional wisdom, including the relative inefficiency of concentrated land ownership and the relevance of the generator's identity. We conclude with a mechanism and a new rights regime that each yield the first best in all cases.engEscola de Pós-Graduação em Economia da FGVSeminários de pesquisa econômica da EPGETodo cuidado foi dispensado para respeitar os direitos autorais deste trabalho. Entretanto, caso esta obra aqui depositada seja protegida por direitos autorais externos a esta instituição, contamos com a compreensão do autor e solicitamos que o mesmo faça contato através do Fale Conosco para que possamos tomar as providências cabíveisinfo:eu-repo/semantics/openAccessIncomplete contracts and the problem of social harminfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleEconomiaExternalidades (Economia)Organização industrial (Teoria econômica)reponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVORIGINAL000302945.pdf000302945.pdfapplication/pdf1770804https://repositorio.fgv.br/bitstreams/2b3b3b85-83c4-4d5b-afb1-19b90eccd910/download3b90fdee15190cf9dae77897d00097ccMD51LICENSElicense.txtlicense.txttext/plain; charset=utf-84707https://repositorio.fgv.br/bitstreams/cee6f024-005d-472b-932a-7f59d139eea7/downloaddfb340242cced38a6cca06c627998fa1MD52TEXT000302945.pdf.txt000302945.pdf.txtExtracted 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dc.title.eng.fl_str_mv |
Incomplete contracts and the problem of social harm |
title |
Incomplete contracts and the problem of social harm |
spellingShingle |
Incomplete contracts and the problem of social harm Pitchford, Rohan Economia Externalidades (Economia) Organização industrial (Teoria econômica) |
title_short |
Incomplete contracts and the problem of social harm |
title_full |
Incomplete contracts and the problem of social harm |
title_fullStr |
Incomplete contracts and the problem of social harm |
title_full_unstemmed |
Incomplete contracts and the problem of social harm |
title_sort |
Incomplete contracts and the problem of social harm |
author |
Pitchford, Rohan |
author_facet |
Pitchford, Rohan |
author_role |
author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EPGE |
dc.contributor.affiliation.none.fl_str_mv |
FGV |
dc.contributor.author.fl_str_mv |
Pitchford, Rohan |
dc.subject.area.por.fl_str_mv |
Economia |
topic |
Economia Externalidades (Economia) Organização industrial (Teoria econômica) |
dc.subject.bibliodata.por.fl_str_mv |
Externalidades (Economia) Organização industrial (Teoria econômica) |
description |
We construct a model in which a first mover decides on its location before it knows the identity of the second mover; joint location results in a negative extemality. Contracts are inherently incomplete since the first mover's initial decision cannot be specified. We analyze several kinds of rights, including damages, injunctions, and rights to exclude (arising from covenants or land ownership). There are cases in which allocating any of these basic rights to the first mover-i.e., first-party rights-is dominated by second-party rights, and cases in which the reverse is true. A Coasian result (efficiency regardless of the rights allocation) only holds under a limited set of conditions. As corollaries of a theorem ranking the basic rights regimes, a number of results emerge contradicting conventional wisdom, including the relative inefficiency of concentrated land ownership and the relevance of the generator's identity. We conclude with a mechanism and a new rights regime that each yield the first best in all cases. |
publishDate |
2000 |
dc.date.issued.fl_str_mv |
2000-08-24 |
dc.date.accessioned.fl_str_mv |
2014-10-31T11:06:54Z |
dc.date.available.fl_str_mv |
2014-10-31T11:06:54Z |
dc.type.status.fl_str_mv |
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info:eu-repo/semantics/article |
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dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10438/12300 |
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http://hdl.handle.net/10438/12300 |
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eng |
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eng |
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Seminários de pesquisa econômica da EPGE |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
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openAccess |
dc.publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
publisher.none.fl_str_mv |
Escola de Pós-Graduação em Economia da FGV |
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