The North American Fur Trade: Bargaining to a Joint Profit Maximum Under Incomplete Information, 1804-1821

Type of resource
Authors/collaborators
Title
The North American Fur Trade: Bargaining to a Joint Profit Maximum Under Incomplete Information, 1804-1821
Abstract
The authors examine bargaining between the Montreal-based Northwest Company and the London-based Hudson's Bay Company using models of "bargaining under incomplete information." Two previously undisturbed bodies of correspondence are analyzed: letters between the two companies and letters between the Hudson's Bay Company and its London committee. The authors explain that through merger the companies achieved a joint maximum, but the lengthy and costly bargaining process dissipated much of the potential gain through depletion of animal stocks. They argue that the achievement of a joint maximum was hindered by incomplete information, commitment to a strategy which led to bargaining breakdowns, delineation of each party's rights under law, and environmental changes.
Publication
The Journal of Economic History
Volume
Vol. 46
Issue
no. 4
Pages
967-986
Date
December 1986
Language
en
Citation
Carlos, Ann M., and Elizabeth Hoffman. “The North American Fur Trade: Bargaining to a Joint Profit Maximum Under Incomplete Information, 1804-1821.” The Journal of Economic History Vol. 46, no. 4 (December 1986): 967–986.
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