Resale markets and the assignment of property rights

The consumption of an indivisible good causes identity-dependent externalit ies to non-consumers. We analyse resale markets where the current owner des igns the trading procedure, but cannot commit to future actions. We ask the following questions: (1) Doer the identity of the initial owner matter for the determination of the final consumer? (2) Is the outcome always efficie nt? The major conclusion of our paper is that the irrelevance of the initia l structure of property rights arises in resale processes even if there are transaction costs that hinder efficiency. This result complements the Coas ian view where the irrelevance of the assignment of property rights is a co nsequence of efficiency.