We analyze the “sequential exchange” problem in which traders have incomplete information on earlier contracts. We show that under sequential exchange, it is in general not possible to simultaneously implement two key features of markets – specialization between asset ownership and...

There is a large body of research in economics and law suggesting that the legal origins of a country—that is, whether its legal regime is based on English common law or French, German, or Nordic civil law—profoundly impacts a range of outcomes. However, the exact relationship between legal...