distribution and equilibrium

[Blair Sandler <blairs@xxxxxxxxxxx>]

Please excuse me if I'm bringing up subjects already discussed....
The Coasian argument claims that assignment of rights is
irrelevant; in any case (leaving aside technical details such as
transactions costs) the same allocation of resources is the
equilibrium (efficient) solution.

Now Coase's article focused on value of production, but he
explicitly acknowledged that the efficient solution required
taking into account the total effect in all social spheres. The
efficient outcome therefore depends on people's (excuse me, I mean
consumers) utility functions. But as I understand it, people's
willingness to pay to avoid harm is different from their
willingness to be paid to accept harm. This means that the
original assignment of property rights will change the effective
set of utility functions and therefore the social welfare function
(what's that? you say), and therefore the efficient solution.

Am I on track here? If so, then this is just a particular instance
of the general argument that equilibrium depends on the
distribution of wealth, right?

If I'm wildly off the mark, please let me know. If my
understanding is basically left (ok, "correct"), then I would like
references for:

*  studies that show willingness to pay and willingness to accept
are not equal

*  papers that show equilibrium can vary with different
distributions of wealth.

Thanks in advance for any help.

Blair Sandler 80 Duncan St. #1 San Francisco, CA  94110
415.282.2163 blairs@xxxxxxxxxxx