Judicial versus Private Auctions: Better without Protection?

Using a sample of 680 and 1,300 judicial and private auctions respectively, we analyze the effect on the wealth of those the law is intended to protect of different regulations applicable to each type of auctions. We find that consistent with a simple economic model, Courts assign judicial auctions...

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Autores principales:	Paredes,Ricardo D, Crisosto K,Andrés, Martí C,Philippe
Lenguaje:	English
Publicado:	Universidad de Chile. Departamento de Economía 2014
Materias:	Auctions regulation efficiency
Acceso en línea:	http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-52862014000200001
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spelling	oai:scielo:S0718-528620140002000012014-12-22Judicial versus Private Auctions: Better without Protection?Paredes,Ricardo DCrisosto K,AndrésMartí C,Philippe Auctions regulation efficiency Using a sample of 680 and 1,300 judicial and private auctions respectively, we analyze the effect on the wealth of those the law is intended to protect of different regulations applicable to each type of auctions. We find that consistent with a simple economic model, Courts assign judicial auctions in a discretional manner, and that the assigned auctioneers charge fees which are substantially higher than those allowed by law. While this behavior put the intended protection to debtor and creditor at risk, economic theory does not rule out a welfare enhancing effect. We test the hypothesis that the judicial auctions' design reduces the welfare of those intended to protect and, consistent with the predictions of our model, we find it is more likely for Courts to appoint the less effective auctioneers and that the net price received by creditors and debtors in judicial auctions is about 18% to 33% below those that could be obtained in private auctions.info:eu-repo/semantics/openAccessUniversidad de Chile. Departamento de EconomíaEstudios de economía v.41 n.2 20142014-12-01text/htmlhttp://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-52862014000200001en10.4067/S0718-52862014000200001
institution	Scielo Chile
collection	Scielo Chile
language	English
topic	Auctions regulation efficiency
spellingShingle	Auctions regulation efficiency Paredes,Ricardo D Crisosto K,Andrés Martí C,Philippe Judicial versus Private Auctions: Better without Protection?
description	Using a sample of 680 and 1,300 judicial and private auctions respectively, we analyze the effect on the wealth of those the law is intended to protect of different regulations applicable to each type of auctions. We find that consistent with a simple economic model, Courts assign judicial auctions in a discretional manner, and that the assigned auctioneers charge fees which are substantially higher than those allowed by law. While this behavior put the intended protection to debtor and creditor at risk, economic theory does not rule out a welfare enhancing effect. We test the hypothesis that the judicial auctions' design reduces the welfare of those intended to protect and, consistent with the predictions of our model, we find it is more likely for Courts to appoint the less effective auctioneers and that the net price received by creditors and debtors in judicial auctions is about 18% to 33% below those that could be obtained in private auctions.
author	Paredes,Ricardo D Crisosto K,Andrés Martí C,Philippe
author_facet	Paredes,Ricardo D Crisosto K,Andrés Martí C,Philippe
author_sort	Paredes,Ricardo D
title	Judicial versus Private Auctions: Better without Protection?
title_short	Judicial versus Private Auctions: Better without Protection?
title_full	Judicial versus Private Auctions: Better without Protection?
title_fullStr	Judicial versus Private Auctions: Better without Protection?
title_full_unstemmed	Judicial versus Private Auctions: Better without Protection?
title_sort	judicial versus private auctions: better without protection?
publisher	Universidad de Chile. Departamento de Economía
publishDate	2014
url	http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-52862014000200001
work_keys_str_mv	AT paredesricardod judicialversusprivateauctionsbetterwithoutprotection AT crisostokandres judicialversusprivateauctionsbetterwithoutprotection AT marticphilippe judicialversusprivateauctionsbetterwithoutprotection
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Judicial versus Private Auctions: Better without Protection?

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