Munich Personal RePEc Archive

Enforcement of Property Rights in a Barter Economy

Hoffmann, Magnus (2006): Enforcement of Property Rights in a Barter Economy.

WarningThere is a more recent version of this item available.
[img]
Preview
PDF
MPRA_paper_3260.pdf

Download (299Kb) | Preview

Abstract

If property rights to consumption goods are insecure, the incentives to trade in a barter economy are reshaped. In a pure exchange economy, we examine the case where two contestable consumption goods are vital to two agents and initial endowments follow a binary distribution. In line with the existing literature, we examine in a two-stage game how the equilibrium security of claims to property is determined. We find that, in equilibrium, two different regimes emerge, depending on the exogenous preference and appropriationeffectiveness parameters: Peaceful coexistence and trade and appropriation,with the former regime strictly Pareto-dominating the latter regime.

Available Versions of this Item

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.