Efficient informal trade: Theory and experimental evidence from the Cape Town taxi market

• 成果类型: Article
• 署名作者: Bengtsson, Niklas
• 署名单位: Uppsala University
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2015.02.003
• 发表日期: 2015
• 页码: 85-98
• 关键词: Informal sector; Market regulations; Taxi experiment; incomplete contracts; transaction costs; institutions; Natural field experiment; Environmental economics

摘要

Informal sectors in developing countries are often thought of as responses to rigid and cumbersome market regulations. In this paper I study informal trade as a first-best outcome. In the model I propose rigid regulations can be necessary to achieve efficiency even though they are always sidestepped. The key assumption is that the regulations define the trading parties' fall-back position in case the informal bargaining process breaks down. I set up a field experiment to test the model's mechanisms in the Cape Town market for metered taxis. Consistent with the model, I find that sidestepping the regulations increase cost efficiency (taxis take the shortest route). The price is however unaffected, suggesting informal bargaining leads to a Pareto improvement. (C) 2015 Elsevier B.V. All rights reserved.