Contributions

  • Posner, Richard A. - Contributor
  • John M. Olin Center for Law, Economics, and Business. - Contributor

Publication

2005 - Harvard Law School, Cambridge, MA, Massachusetts

Language

English

Word Count

3,250 words, Guess

Page Count

13 pages

Physical Format

Electronic resource

Identifiers

Classifications

  • LCCK487.E3

Description

"This paper shows that "one-sided" terms in standard contracts, which deny consumers a contractual benefit that seems efficient on average, may arise in competitive markets without informational problems (other than those of courts). A onesided term might be an efficient response to situations in which courts cannot perfectly observe all the contingencies needed for an accurate implementation of a "balanced" contractual term when firms are more concerned about their reputation, and thus less inclined to behave opportunistically, than consumers are. We develop this explanation, discuss its positive and normative implications, and compare them to those of informationbasedexplanations for one-sided terms"--John M. Olin Center for Law, Economics, and Business web site.

Subjects

Series Statement

  • Discussion paper -- no. 534

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