We examine experimentally the bargaining process and the final allocation of payoffs in games that differ in terms of whether or not the core exists and in the initial allocation of property rights among the players. The paper highlights the interaction between property rights, transaction costs...

Using a simple bilateral trading example with discrete valuations and costs (based on Matsuo, Journal of Economic Theory, 1989), this note demonstrates that in the presence of private information the efficiency of Coasean bargaining may in some situations be strictly enhanced if initially no...

When there are three parties, instability problems brought about by the emptiness of the core of the corresponding cooperative game may cause the Coase Theorem to fail, even when other more direct impediments to bargaining are low. We show that the standard Coasean bargaining game involving...

We investigate the efficiency of Coasean bargaining when restrictions are placed on the set of feasible bargaining outcomes. When property rights are costly to (defend) appropriate, we find bargaining restrictions may be Pareto superior to unconstrained voluntary exchange. Under cost uncertainty...

The case for taxing financial transactions merely to raise more revenues from the financial sector is not particularly strong. Better alternatives to tax the financial sector are likely to be available. However, a tax on financial transactions could be justified in order to limit socially...