Environmental Coordination: Reneging And Transaction Costs

Promises and Endogenous Reneging Costs∗

We present a novel theoretical mechanism that explains the capacity for non-enforceable communication about future actions to improve efficiency. We explore a two-player partnership game where, before choosing a level of effort to exert on a joint project, each player makes a cheap talk promise to their partner about their own future effort. We allow agents to incur a psychological cost of rene...

Investigating Search Costs and Coordination Costs in Electronic Markets: A Transaction Costs Economics Perspective

This paper examines how World Wide Web (WWW) usage for procurement purposes affects corporate buyers’ search costs and buying organizations’ coordination costs and how it ultimately affects the efficient boundaries of buying organizations. The analysis is based on a model that integrates Transaction Costs Economics (TCE) (Williamson 1975, 1985) and forces of electronic interconnections (Malone ...

The Political Transaction Costs and Uncertainties of Establishing Environmental Rights

Networks and Transaction Costs

Based on the well-known fact that social networks can provide effective mechanisms that help to increase the trust level between two trade partners, we apply a simple game-theoretical framework to derive transaction costs as a high risk of opportunistic behavior in a repeated trade relation determined by the density and size of trading networks. In the empirical part of the paper we apply a two...

Transaction Costs and the Performance

Tradeable-permit systems are at the center of current interest and activity in market-based reforms of environmental policy, because these systems can offer significant advantages over conventional approaches to pollution control. Unfortunately, claims made for their relative costeffectiveness have often been exaggerated. Transaction costs, which are ubiquitous in these markets, reduce trading ...