Transaction Costs in Payment for Environmental Service Contracts

Bilateral contracts with transaction costs

The paper studies bilateral contracting with endogenous property rights. Players engage in costly ex post adjustment of ex ante contract. After ex ante agreement on surplus sharing, players invest irreversibly production. Player costs of altering ex ante contract are transaction costs of three kinds: measurement, information and enforcement costs. Each player chooses an action which incurs tran...

Incentives versus transaction costs: a theory of procurement contracts

Inspired by facts from the private-sector construction industry, we develop a model that explains many stylized facts of procurement contracts. The buyer in our model incurs a cost of providing a comprehensive design and is faced with a tradeoff between providing incentives and reducing ex post transaction costs due to costly renegotiation. We show that cost-plus contracts are preferred to fixe...

Multiperiod Portfolio Selection with Different Rates for Borrowing and Lending in Presence of Transaction Costs

Portfolio management is one of the most important areas of research in financial engineering. This paper is concerned with multi period decision problem for financial asset allocation when the rate of borrowing is greater than the rate of lending. Transaction costs as a source of concern for portfolio managers is also considered in this paper. The proposed method of this paper is formulated in ...

The Political Transaction Costs and Uncertainties of Establishing Environmental Rights

Verifiable Transaction Atomicity for Electronic Payment Protocols

We study the transaction atomicity problem for designing electronic payment protocols in distributed systems. We observe that the techniques that are used to guarantee transaction atomicity in a database system are not robust enough to guarantee transaction atomicity in an electronic payment system, in which a set of dishonest or malicious participants may exhibit unpredictable behavior and cau...