Giuseppe Dari-Mattiacci, ‘The Economic Perspective: Demand and Supply in the Reduction of Transaction Costs in the Ancient World’

Abstract:
In this chapter, I distill some elements of the demand and supply of institutions designed to reduce transaction costs in the ancient world. I some cases, contractual parties could reduce transaction cost by accurately designing contracts. In other cases, the failure of private coordination placed the state in a better position than private parties in reducing transaction costs. I emphasize two such (by no means exclusive) contexts: cases in which the gains from reducing transaction costs were spread among large numbers of transactions and cases in which contracts have effects for third parties. Identifying a demand for state intervention raises the question whether the state supplied the appropriate institutions. The state supply of institutions to reduce transaction costs in the ancient world varied. A political-economy perspective suggests that differences depend on the extent to which the state internalizes the gains generated from such institutions.

Dari-Mattiacci, Giuseppe, The Economic Perspective: Demand and Supply in the Reduction of Transaction Costs in the Ancient World (April 18, 2013). (Forthcoming) Dari-Mattiacci, Giuseppe, ‘The Economic Perspective: Demand and Supply in the Reduction of Transaction Costs in the Ancient World,’ in Uri Yiftach-Firanko, Dennis P. Kehoe and David M. Ratzan (eds.), Transaction Costs in the Ancient Economy, Ann Arbor (MI): Michigan University ; Amsterdam Law School Research Paper No. 2013-24; Amsterdam Center for Law & Economics Working Paper No. 2013-06.

First posted 2013-04-19 07:55:01

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