Transaction costs and institutions: investments in exchange

Nolan, C. and Trew, A. (2015) Transaction costs and institutions: investments in exchange. B.E. Journal of Theoretical Economics, 15(2), pp. 391-432. (doi: 10.1515/bejte-2013-0090)

[img]
Preview
Text
106335.pdf - Published Version

5MB

Abstract

This paper proposes a simple model for understanding transaction costs – their composition, size and policy implications. We distinguish between investments in institutions that facilitate exchange and the cost of conducting exchange itself. Institutional quality and market size are determined by the decisions of risk adverse agents and conditions are discussed under which the efficient allocation may be decentralized. We highlight a number of differences with models where transaction costs are exogenous, including the implications for taxation and measurement issues.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Nolan, Professor Charles and Trew, Professor Alex
Authors: Nolan, C., and Trew, A.
College/School:College of Social Sciences > Adam Smith Business School > Economics
Journal Name:B.E. Journal of Theoretical Economics
Publisher:De Gruyter
ISSN:2194-6124
ISSN (Online):1935-1704
Copyright Holders:Copyright © 2015 Walter de Gruyter GmbH.
First Published:First published in B.E. Journal of Theoretical Economics 15(2):391-432
Publisher Policy:Reproduced in accordance with the copyright policy of the publisher

University Staff: Request a correction | Enlighten Editors: Update this record