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Ownership Structure as a Continuous Variable: A Note on Joint Ownership in the Grossman-Hart-Moore Theory of the Firm

Author

Listed:
  • Takanori Adachi

    () (School of Economics, Nagoya University)

Abstract

This study considers the choice of ownership as a continuous variable, thereby adapting the Grossman-Hart-Moore (GHM) theory of the firm. To do so, it is assumed that parties sign a contract that enables them to divide and use assets even after the negotiation over gains of trade fails. I show sufficient conditions for non-integration to dominate joint ownership, which is not taken into account in the original GHM model.

Suggested Citation

  • Takanori Adachi, 2010. "Ownership Structure as a Continuous Variable: A Note on Joint Ownership in the Grossman-Hart-Moore Theory of the Firm," Economics Bulletin, AccessEcon, vol. 30(3), pages 2112-2118.
  • Handle: RePEc:ebl:ecbull:eb-10-00385
    as

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    References listed on IDEAS

    as
    1. Aghion, P. & Tirole, J., 1993. "On the Management of Innovation," Working papers 93-12, Massachusetts Institute of Technology (MIT), Department of Economics.
    2. Rosenkranz, Stephanie & Schmitz, Patrick W., 2003. "Optimal allocation of ownership rights in dynamic R&D alliances," Games and Economic Behavior, Elsevier, vol. 43(1), pages 153-173, April.
    3. Susheng Wang & Tian Zhu, 2005. "Control Allocation, Revenue Sharing, And Joint Ownership," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 46(3), pages 895-915, August.
    4. Philippe Aghion & Jean Tirole, 1994. "The Management of Innovation," The Quarterly Journal of Economics, Oxford University Press, vol. 109(4), pages 1185-1209.
    5. Patrick W. Schmitz, 2006. "Information Gathering, Transaction Costs, and the Property Rights Approach," American Economic Review, American Economic Association, vol. 96(1), pages 422-434, March.
    6. Andreas Roider, 2004. "Asset Ownership and Contractibility of Interaction," RAND Journal of Economics, The RAND Corporation, vol. 35(4), pages 787-802, Winter.
    7. Maija Halonen, 2002. "Reputation And The Allocation Of Ownership," Economic Journal, Royal Economic Society, vol. 112(481), pages 539-558, July.
    8. Kurt Annen, 2009. "Efficiency out of disorder: Contested ownership in incomplete contracts," RAND Journal of Economics, RAND Corporation, vol. 40(4), pages 597-610.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Theory of the firm; Joint ownership;

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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