Contract remedies: general

Mahoney, Paul G.

doi:10.4337/9781849806640.00015

Cited by 6 publications

(4 citation statements)

References 36 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…For example, specific performance—the party breaching a contract or a tortfeasor respectively must perform according to the contract or render restitution in natura (cf. Mahoney 2000)—is not applicable, since no contract is made in the first stage (thus there is nothing to breach) and the contract in the second stage is complete and furthermore backed up by incentives (payoffs exceed those under the outside option thus no one will breach). Or viewed differently, specific performance amounts to execute the outside option in the second stage (see Section 3), for example, to enforce the regulated standard.…”

Section: Frameworkmentioning

confidence: 99%

Comparing Environmental Policy Instruments Within an Incomplete Contract Framework

Wirl

2013

J Public Economic Theory

View full text Add to dashboard Cite

This paper compares three different legal means—no environmental policy (the pollutee pays), full liability (the polluter pays), and pollution standards—to reduce and regulate neighborhood externalities within an incomplete contract framework. It turns out that the relative efficiency of these instruments depends, in general, on details. However, moderate standards are preferable to no environmental policy and tight (but not too tight) standards dominate liability. This provides under the given assumptions (neighborhood externalities, incomplete contracts) a justification for “sensible” standards for three reasons. First, unilateral allocations of property rights are biased that distort allocations even if ex post bargaining takes place. Second, a standard is superior in the following sense: if it is set equal to the outcome under any allocation of rights, it will be improved in the process of ex post bargaining. Third, unilateral property rights encourage strategic ex ante investments up to the point that committing to no bargaining would be beneficial (if possible).

show abstract

Section: Frameworkmentioning

confidence: 99%

Comparing Environmental Policy Instruments Within an Incomplete Contract Framework

Wirl

2013

J Public Economic Theory

View full text Add to dashboard Cite

show abstract

“…For example, Birmingham (1970), Barton (1972), Goetz and Scott (1977), Schwartz (1979), Shavell (1980Shavell ( , 1984, Miceli (2004), and Schwartz and Scott (2008), among many others, have studied various damages measures for breach of contract and compared their efficiency. Edlin and Schwartz (2003) and Mahoney (2000) provide excellent surveys of this literature. Almost without exception these studies assume that the non-breaching party will always pursue a remedy for the contract breach regardless of her post-breach valuation.…”

Section: Related Literaturementioning

confidence: 99%

Private Information and the Option to Not Sue: A Reevaluation of Contract Remedies

Avraham¹,

Liu

2009

Journal of Law, Economics, and Organization

View full text Add to dashboard Cite

In this paper we study contracts with two-sided incomplete information. Prior literature on contract remedies does not formally account for the non-breaching party's option to not sue for damages upon breach, when her expected payoff from suing is negative, given the contractual terms and her private information about her post breach loss. With this option incorporated into the analysis, we show that: First, courts should commit to awarding fixed damages, because awarding flexible damages based on ex post information will distort the incentives to breach. This result is not driven by the information forcing effect of basing damages on ex ante expectations, ̀ la Hadley vs. Baxendale. Second, the option of acquiescing to the breach expands the breach set under specific performance, which can be more efficient than other remedies. Third, the efficiency advantage of ex ante expectation damages over ex post actual damages is further enhanced when we account for the possibility of renegotiation. The main results are robust when we account for verification cost of plaintiff's damages and for parties' litigation cost.

show abstract

“…For concreteness, I will usually speak of contracts for production of goods rather than for performance of services even though the analysis of the two is the same.65 In many respects, I will be using as a basis my articlesShavell 1980aShavell , 1984a, but I will also be depending on numerous other articles, as I will note. See also the surveysEdlin 1998, Kaplow and Shavell 2002a, Mahoney 2000, Schwartz 1998, and Shavell 1998 …”

mentioning

confidence: 99%

Economic Analysis of Contract Law

Shavell

2003

SSRN Journal

View full text Add to dashboard Cite

Contract law governs agreements between parties. This paper contains the chapters on contract law from a general, forthcoming book, Foundations of Economic Analysis of Law (Harvard University Press, 2003). Chapter 13 presents an overview of the subject. Chapter 14 is concerned with contract formation, that is, with the process through which parties find contracting partners, with aspects of contract negotiation, and with the rules governing when an arrangement between parties becomes legally recognized as a contract. Chapter 15 considers at length an important type of contract: the contract to produce something. Chapter 16 is concerned with two other types of contract: the contract for transfer of possession of something that already exists (such as land or a painting), and donative contracts.

show abstract

Contract remedies: general

Cited by 6 publications

References 36 publications

Comparing Environmental Policy Instruments Within an Incomplete Contract Framework

Comparing Environmental Policy Instruments Within an Incomplete Contract Framework

Private Information and the Option to Not Sue: A Reevaluation of Contract Remedies

Economic Analysis of Contract Law

Contact Info

Product

Resources

About