transaction costs

Publication date: 29 Sep 2012 | Publication type: NIESR Discussion Paper | Theme: Trade, Investment & Productivity, Employment & Social policy | Authors: Bryson, A | NIESR discussion paper number: 399
Whether it is better to adopt voice or exit depends on the  nature of the transaction for both parties. The strongest voice-sustaining equilibrium is where both parties see voice as preferable to exit. This is likely where both parties have substantial sunk costs. In other circumstances, there is ...