Could What You Don’t Know Hurt You? Information Asymmetry in Land Markets in Late Antiquity

P.V. (Meylekh) Viswanath and Michael Szenberg

in The Oxford Handbook of Judaism and Economics

Published in print December 2010 | ISBN: 9780195398625
Published online September 2012 | | DOI:

Series: Oxford Handbooks

 Could What You Don’t Know Hurt You? Information Asymmetry in Land Markets in Late Antiquity

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Jewish legal texts are important sources of information on Middle Eastern economies in the early centuries of the Common Era (ce). This article focuses on the Rashi’s explanation of seasonality and trading volume fluctuations of land prices, as discussed in tractate Bava Kamma of the Babylonian Talmud (Roman Palestine). Although the text itself was redacted in Babylonia, it is largely a commentary on the Mishnah, an earlier text redacted in Roman Palestine toward the end of the second-century ce. It may be argued that information asymmetry is a reasonable assumption in a firm, where the activities of the managers are not easily observable. It might even be reasonable in the case of land with multiple uses. The evidence of the Talmud indicates that information asymmetry can considerably depress the prices of assets and affect the liquidity of markets. This indicates the importance of attempts to reduce information asymmetry. Future work on market frictions in antiquity might consider other examples of information asymmetry in the agricultural economies discussed in the Babylonian and Jerusalem Talmuds.

Keywords: Middle Eastern economies; information asymmetry; land prices; trading; economies; Common Era

Article.  5844 words. 

Subjects: Economics ; Economic History

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