Abstract

http://ssrn.com/abstract=2119736
 


 



The Social Efficiency of Fairness: An Information Economics Approach to Innovation


Gavin Clarkson


NMSU - Finance Department / Indian Resource Development Program

Marshall W. Van Alstyne


Boston University - Department of Management Information Systems; Massachusetts Institute of Technology (MIT) - Sloan School

August 15, 2005

TPRC 2005

Abstract:     
Our key argument is that commitment to a fairness mechanism is socially efficient. The capacity for innovation rises as parties with complementary resources, particularly information, find ways to agree to combine their resources. Traditional mechanisms that focus on ownership and control as a means to eliminating opportunism risk overlook this form of efficiency gain. We show this proposition formally both for individual two-party transactions and more generally for repeated and multi-party interactions.

Number of Pages in PDF File: 41

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Date posted: July 30, 2012 ; Last revised: October 2, 2012

Suggested Citation

Clarkson, Gavin and Van Alstyne, Marshall W., The Social Efficiency of Fairness: An Information Economics Approach to Innovation (August 15, 2005). TPRC 2005. Available at SSRN: http://ssrn.com/abstract=2119736

Contact Information

Gavin Clarkson (Contact Author)
NMSU - Finance Department / Indian Resource Development Program ( email )
Las Cruces, NM 88003
United States
575-646-3636 (Phone)
Marshall W. Van Alstyne
Boston University - Department of Management Information Systems ( email )
595 Commonwealth Avenue
Boston, MA 02215
United States
617-358-3571 (Phone)
HOME PAGE: http://smgapps.bu.edu/mgmt_new/profiles/VanAlstyneMarshall.html
Massachusetts Institute of Technology (MIT) - Sloan School ( email )
Center for Digital Business
5 Cambridge Center - NE25, 7th Floor
Cambridge, MA 02142
United States
617-253-0768 (Phone)
HOME PAGE: http://web.mit.edu/marshall/www/home.html
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