User:Arbraxan/Property Rights Theory

The Property Rights Theory (PRT) of the firm is an economic theory that explains the effect of integration on firm performance within the vertical chain. The main proposition of PRT is that integration determines the ownership and control of assets, through which firms are able to exploit contractual incompleteness.

The development of PRT can be attributed to Sanford Grossman, John Moore and Oliver Hart. The theory is generally associated with the theory of the firm, contract theory and the property rights literature.

Literature

 * Grossman, S., Hart, O. (1986). The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration. Journal of Political Economy, 94(4), pp. 691-719.
 * Hart, O., Moore, J. (1990). Property Rights and the Nature of the Firm. Journal of Political Economy, 98(6), pp. 1119-1158.

Microeconomics