This paper studies markets plagued with asymmetric information on the quality of traded goods. In Akerlof's setting, sellers are better informed than buyers. In contrast, we examine cases where buyers are better informed than sellers. This creates an inverse adverse selection problem: The market...

In several contract situations, parties exchange promises of future performance, creating reciprocal obligations. In this paper, we extend the standard models of contract remedies to consider the incentives created by contracts where both parties provide only executory consideration and where...

Various reformulations of the Coase theorem have developed normative corollaries on the choice of optimal remedies in the presence of positive transaction costs. In this article, we consider the extent to which these propositions are affected by the presence of asymmetric transaction costs, and...

In an economic perspective, punitive damages and class actions can be viewed as sharing a common economic function – creating optimal deterrence. Building on Parisi and Cenini (2010), we study the effect of alternative procedural regimes on the effectiveness of punitive damages and class...

Political markets may be curative of political externalities, yet they are often unviable due to the presence of bargaining externalities. In this paper we study the extent to which the choice of voting dimensions may affect the viability of Coasian bargaining in a political context. The results...

In this paper, we study the effects and desirability of legal rules that allow the sharing of an accident loss between a non-negligent injurer and his non-negligent victim. In order to identify the virtues and limits of loss-sharing rules, we begin by considering the effect of a loss-sharing...

In a dispute involving multifarious points of disagreement, courts have the discretion to adjudicate issues separately in multiple, sequential proceedings or all-at-once in a single unitary proceeding. In this paper, we contrast the effects of sequential and unitary trials on parties' decisions...

In the field of comparative law, the use of economic analysis has been at the same time fashionable and controversial. Notwithstanding its controversial acceptance in the discipline, the so-called comparative law and economics method is an important example of the application of economics to...

Litigation aims at resolving conflicts. In this chapter we survey the law and economics literature on litigation to illustrate the scope of application of rent-seeking models and their analytical power in the study of law and procedural issues of litigation, including applications in adversarial...

In rent-seeking contests, players are seldom identical to one another. In this chapter, we examine the rent-seeking literature that explores the effects of specific forms of asymmetry between contestants. We consider Tullock's rent-seeking contests involving two players who differ in strength...