Transaction cost first appears in the ECON2005 Intermediate Macroeconomics course, but it then appears in ECON2003 Intermediate Microeconomics II about the Coase Theorem
It also appears in ECON4008 Law and Economics
It means expenses incurred when buying or selling a good or service
The potential Transaction Cost for Bargaining may be
- Search cost (Before Bargaining) , if you are just playing Game Theory with your roommate, it has a relatively low Search Cost.
- Bargaining cost (during Bargaining), it includes the Asymmetric Information, Free-Rider problem, and Hold-out problem (many sellers sharing the sale)
- Enforcement cost (after Bargaining)
High or Low
When Transaction Cost is low, that leads to facilitate voluntary trade, often related to Private Goods.
When Transaction Cost is high, that leads to allocate rights efficiently, often related to Public Goods
In ECON4008 Law and Economics, we measure the cost mostly consider how many people in the people.
Reference
https://zh.wikipedia.org/zh-cn/%E4%BA%A4%E6%98%93%E6%88%90%E6%9C%AC