(Thursday, 4th April 2002)
This lecture presents the legal aspects of contracts theory. It will discuss when is state enforcement of promises necessary to a well functioning market economy? What roles should the state play regarding the set of contracts for which enforcement is necessary? Then it will treat supplying default rules and reducing contracting costs. The last part of the lecture will discuss when should unfairness justify not enforcing contracts?
Bibliographical references :
Alan Schwartz and Joel Watson, "The Law and Economics of Costly Contracting". mimeo.
Alan Schwartz, "Contract Theory and Theories of Contract Regulation". in E. Brousseau & J.-M. Glachant (eds), Revue d'Economie Industrielle, N° Spécial, Économie des Contrats : Bilan et Perspective, N° 92, 2eme et 3eme trimestre 2000.
Alan Schwartz, "Incomplete Contracts" in The New Palgrave Dictionary of Economics and the Law, Volume II, pages 277-82.