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Resource allocation with spatial externalities: Experiments on land consolidation

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  • Tomomi Tanaka

    (California Institute of Technology)

Abstract

This paper compares the performance of direct negotiation, double auction, and a two-sided combinatorial call market for consolidating fragmented land. Experimental results suggest direct negotiation produces higher efficiencies than other mechanisms when 1) all commodities need to be traded to achieve efficiency, and 2) subjects are well exposed to various experimental formats. The combinatorial call market performs well when 1) swapping is easily agreeable, and 2) the number of subjects and commodities are increased and the initial endowments are unchallenging. The two-sided combinatorial call market suffers from the holdout problem when the number of subjects and commodities is small.

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File URL: http://128.118.178.162/eps/exp/papers/0511/0511004.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Experimental with number 0511004.

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Length: 34 pages
Date of creation: 16 Nov 2005
Date of revision:
Handle: RePEc:wpa:wuwpex:0511004

Note: Type of Document - pdf; pages: 34
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Web page: http://128.118.178.162

Related research

Keywords: Mechanism design; Two-sided combinatorial auction; Holdout;

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References

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Cited by:
  1. John Cadigan & Pamela Schmitt & Robert Shupp & Kurtis Swope1, 2009. "An Experimental Study of the Holdout Problem in a Multilateral Bargaining Game," Southern Economic Journal, Southern Economic Association, vol. 76(2), pages 344-457, October.
  2. Deininger, Klaus & Savastano, Sara & Carletto, Calogero, 2012. "Land fragmentation, cropland abandonment, and land market operation in Albania," Policy Research Working Paper Series 6032, The World Bank.
  3. Kurtis Swope & Pamela Schmitt & John Cadigan & Robert Shupp, 2009. "The Holdout Problem and Urban Sprawl: Experimental Evidence," Departmental Working Papers 24, United States Naval Academy Department of Economics.

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