Measurement Cost and the Organization of Markets

@article{Barzel1982MeasurementCA,
  title={Measurement Cost and the Organization of Markets},
  author={Y. Barzel},
  journal={The Journal of Law and Economics},
  year={1982},
  volume={25},
  pages={27 - 48}
}
  • Y. Barzel
  • Published 1982
  • Economics
  • The Journal of Law and Economics
PEOPLE will exchange only if they perceive what they get to be more valuable than what they give. To form such perceptions, the attributes of the traded items have to be measured. Some measurements are easy to obtain; others pose difficulties. For example, determining the weight of an orange may be a low-cost, accurate operation. Yet what is weighed is seldom what is truly valued. The skin of the orange hides its pulp, making a direct measurement of the desired attributes costly. Thus the taste… Expand
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References

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Some Fallacies in the Interpretation of Information Costs
  • Y. Barzel
  • Economics
  • The Journal of Law and Economics
  • 1977
Demsetz, Production, Information Costs, and Economic Organization, 62
  • Am. Econ. Rev
  • 1972
An earlier analysis of these markets by Acheson and McManus is not unlike the one presented here
    The costliness of measuring the protein content of wheat and the resulting allocation of
      The costliness of measuring the protein content of wheat and the resulting allocation of This content downloaded from 143