Optimal structure and dissolution of partnerships

Loertscher, Simon and Wasser, Cédric. (2019) Optimal structure and dissolution of partnerships. Theoretical Economics, 14 (3). pp. 1063-1114.

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Official URL: https://edoc.unibas.ch/72612/

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For a partnership model with general type distributions and interdependent values, we derive the optimal dissolution mechanisms that, for arbitrary initial ownership, maximize any convex combination of revenue and social surplus. The solution involves ironing around typically interior worst-off types, which are endogenously determined. The optimal ownership structures are such that, with identical distributions, equal shares are always optimal. With nonidentical distributions, the optimal shares are typically asymmetric, the identity of the agents with large shares may change with the importance of revenue generation, and even fully concentrated initial ownership and assigning zero shares to the strongest agents can be optimal.
Faculties and Departments:06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften > Professuren Wirtschaftswissenschaften > Mikroökonomische Theorie (Nöldeke)
UniBasel Contributors:Wasser, Cédric
Item Type:Article, refereed
Article Subtype:Research Article
Note:Publication type according to Uni Basel Research Database: Journal article
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Last Modified:12 Nov 2019 08:54
Deposited On:12 Nov 2019 08:54

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