Abstract
If negotiation over ownership of an asset is unsuccessful, agents go to court to determine possession. Experiments examine how the presence of a stochastic court decision affects pretrial bargaining behavior. Two players have private information over the value of an asset, owned by one player. If there is no acceptable trade price, a random court decision assigns ownership. The impact of a second stage court decision on bargaining outcomes and the efficiency of trades is measured. Courts reduce the total earnings of players and the frequency of efficient trades. Relative earnings and bargaining behavior depend on which agent proposes the trade price.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
