This laboratory experiment explores the extent to which impersonal exchange emerges from personal exchange with opportunities for long-distance trade. We design a threecommodity production and exchange economy in which agents in three geographically separated villages must develop multilateral exchange networks to import a third good only available abroad. For treatments, we induce two distinct institutional histories to investigate how past experience with property rights affects the evolution of specialization and exchange. We find that a history of un-enforced property rights hinders our subjects¡¯ ability to develop the requisite personal social arrangements necessary to support specialization and effectively exploit impersonal long-distance trade.
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Paper provided by George Mason University, Interdisciplinary Center for Economic Science in its series Working Papers with number
1002.
Find related papers by JEL classification: C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies F10 - International Economics - - Trade - - - General N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative