We think it does … because slaves by definition are unable to bargain for their freedom. Our colleague and good friend Glen Whitman says it does not … read his reasons and our objections to his argument in the comments section to this fascinating blog post on “Haitian zombies and slave economics.” (Recall that the Coase Theorem predicts that an economic asset will be allocated to its most valuable use regardless of who initially owns that asset, provided that market frictions or “transaction costs” are low — i.e. provided that the owner of the asset is able to bargain with potential buyers who want the asset.) Who is right?
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