Law Commons^™

Property Rules, Liability Rules, And Uncertainty About Property Rights, Stewart E. Sterk

Michigan Law Review

Clarity can be a considerable virtue in property rights. But even when property rights are defined clearly in the abstract, ascertaining the scope of those rights in concrete situations often entails significant cost. In some instances, the cost of acquiring information about the scope of property rights will exceed the social value of that information. In those circumstances, further search for information about the scope of rights is inefficient; the social harm avoided by further search does not justify the costs of the search. Potential resource users, however make decisions based on private costs and benefits, not social costs and …