Title: The Divarication and Amalgamation of Incomplete Contracting Theory of New Institutional Economics
Abstract:This paper summarizes Transaction Cost Economics (TCE) and Property Rights Theory (PRT) which both are branches of Incomplete Contracting Theory of New Institutional Economics. TCE and PRT share the c...This paper summarizes Transaction Cost Economics (TCE) and Property Rights Theory (PRT) which both are branches of Incomplete Contracting Theory of New Institutional Economics. TCE and PRT share the common base in bounded rationality, opportunism and asset specificity, but have distinct difference in emphasis and method to solve the contractual incompleteness. TCE mainly attributes the transaction cost of contractual incompleteness to ex post disorder, hence emphasize ex post adaptive governance; con-trarily, PRT mainly attributes to ex ante inadequate incentive of specific investment and therefore ex ante incentive mechanism. In future, TCE and PRT will be well amalgamated if there is the model based on bounded rationality.Read More
Publication Year: 2005
Publication Date: 2005-01-01
Language: en
Type: article
Access and Citation
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot