Economic Analysis of Property Rights

The Economic Analysis of Property Rights explains why some organizations arise over others by examining the costs of strengthening economic property rights. It offers a unified theoretical structure to deal with exchange, rights formation, and organization that traditional economic theory often ignores, and shows how transaction costs can be reduced through reorganization, leading to the distribution of property rights that maximizes wealth net of these costs.

Format: Hardback
Length: 300 pages
Publication date: 31 August 2023
Publisher: Cambridge University Press

The standard neoclassical model of economics fails to explain why one form of organization emerges over another. It operates on the assumption that transaction costs do not exist, despite the fact that they are explicitly defined as the costs associated with strengthening a specific distribution of economic property rights. These costs are inherent and always present.

Economic Analysis of Property Rights delves into the study of how individuals allocate resources to maximize the value of their economic rights over these resources. It provides a comprehensive theoretical framework that addresses exchange, rights formation, and organization, which traditional economic theory often overlooks. This approach sheds light on how transaction costs can be minimized through reorganization, ultimately leading to the distribution of property rights that maximizes wealth net of these transaction costs.

This crucial hypothesis offers an explanation for many of the perplexing organizations and institutions that exist in the present and have existed in the past. It sheds light on the factors that drive the formation and evolution of different organizational structures and helps us understand the dynamics of economic systems. By recognizing the existence of transaction costs and the importance of property rights, Economic Analysis of Property Rights provides a valuable tool for economists, policymakers, and business practitioners alike. It enables them to make informed decisions and design strategies that promote efficiency, fairness, and sustainable growth.

Weight: 598g
ISBN-13: 9781009374736
Edition number: 3 Revised edition