The best way to eliminate domain squatting is to make domains non-transferrable. If you own a domain you shouldn't be able to transfer it to anyone. The only way to "transfer" a domain should be to return it to the domain registry where it may be purchased by any interested party at market price determined by auction.
What if I register a domain with a shell corp and a straw "contact" who is an employee of Mossack Fonseca (or whatever)? If I want to transfer the domain I just sell the shell corp.
Then you have to pay an extra $50 or $100 a year to maintain your corporation per domain, which reduces the number of domains you can own with a fixed amount of expenses.
No, that would just cause a new form of corporation to arise in some jurisdiction that costs a dollar per year to maintain, that's limited to owning a single domain name.
Given the way transfers work, that would also mean you couldn't move a domain from one registrar to another. So if you had a domain that anyone else would want, and your registrar decided to raise their prices or change their policies, you'd be unable to leave without losing your domain.
Domain registrars that engaged in holding domains hostage and increasing prices would probably eventually go out of business.
Even if that ended up not being the case, we'd have to fix how domains are transferred between registrars - same as how telephone numbers can be transferred between telcos but you can't sell your telephone number to someone.
This topic is relevant to my interests. I've googled around a little bit on research on the topic of eliminating squatters, but haven't come up with much. I'd appreciate pointers to papers if anyone has them.
Coase theorem applies if there are a) zero or sufficiently low transaction costs and b) if parties are able to bargain.
If domains have to be returned back to the registrar b) doesn't apply. Auctions ensure that a) doesn't apply either.
Furthermore, adding a 7 day waiting period before returned domains become available will further ensure that parties cannot trade domains between each other but must purchase from the registrar which makes owning a domain and squatting on it for purposes of selling it pointless.
Right, but both (a) and (b) do apply to the existing system where domain names can be traded. What Coase theorem says is that the resulting allocation will be efficient, regardless of how you do the initial allocation. I.e. it's irrelevant whether people pay squatters to get the domain names they want or ICAAN directly via auctions.
However this probably isn't going to change.