[In: Volume 6, Gerrit De Geest (ed) Contract Law and Economics]

• accident avoidance 426

• Acemoglu, D. 425

• action-directing action 62

• adaptation

  • autonomous 285–286, 288

  • coordinated 285–286, 288

• add-ons 417

• adhesion contracts see standard form contracts

• Adler, Barry E. 231–2, 236

• administrative control 285

• adverse selection 226

• agency costs and third-party interests 148–9

• agency problems 431

• Aghion, Phillipe, Mathias Dewatripont and Patrick Rey 291, 293, 295

• Aghion, Phillipe and Benjamin Hermalin 196–7

• Aghion, Phillipe and Patrick Bolton 193–5, 324–5

• Aivazian, Varouj A. 447

• Aivazian, Varouj A. et al. 73

• Akerlof, George A. 444

• Albert, Ross A. 458

• aleatory view of negotiations 9, 12, 24

• Allen, D.W. 377

• allocative efficiency 32, 34, 36, 42, 105, 156

• Almond 373

• alternative governance mechanisms 129, 146

• altruism see bequests, altruistic bequests

• ambiguity aversion 200

• anchoring 404

• Anglo-American theory of contract law 9, 80

• Anglo-Canadian law 80, 89, 91, 430

• Anglo-Saxon inheritance 106–7

• annulment of contract 440

• anticipatory repudiation 171

• arbitration 129, 146

• arbitration in franchise agreements 393

• Arlen, Jennifer 405, 408

• Arrondel, L. and A. Lafferère 108

• assets

  • complementary 287

  • specificity 282

  • substitute 287

• assumpsit 455

• asymmetric paternalism 411

• Attorney General v. Blake 466

• at-will termination 353

• at-will, franchise 392

• autonomous adaptation 285–286, 288

• Axiom of Unilateral Action 245–248

• Ayres, I. 197, 363, 371 see Rasmusen, E. and I. Ayres; Ayres, I. and G. Klass

• Ayres, I. and G. Klass 46

• Ayres, Ian and Robert Gertner 226–228, 232, 235–236

• bailout 296–7

• Baldus photographs case 439

• bargaining 249–50, 448

• bargaining power 16, 115–16

• bargaining, revolving-offer 292–3

• Bar-Gill, Oren 120, 230–31, 416–18

• Bar-Gill, Oren and Omri Ben-Shahar 63–4, 69, 71

• barriers to efficient contracts 156–7

• Bartholomew, J. 377

• Barton, John H. 158

• Basu, Kaushik 65

• Bates, T. 389

• Baumol, W.J. 302

• Beales, H. 36

• Beales, J. and T. Muris 351

• Bebchuk, L.A. and Omri Ben-Shahar 10, 12, 17, 19–20, 25, 27

• Bebchuk, L.A. and R.A. Posner 120

• Bebchuk, Lucian Ayre and Steven Shavell 226–228, 232

• Becher, Shmuel I. 122

• p. 472Becker, Gary S. 361

• Becker, Gerry 41 see legal deterrence, theory of

• Becker–Barro model 103

• behavioral approaches to contract law 401–21

• behavioral economics 401–21

• benefit-based liability 465

• Ben-Shahar, Omri 10, 18–19, 25, 40, 131, 144, 426

  • see Bebchuck and Omri Ben-Shahar; Bar-Gill, Oren and Omri Ben-Shahar

• Ben-Shahar, Omri and J.J. White 121

• bequests

  • accidental or unplanned bequests 97–98, 106

  • altruistic bequests 99–100, 106

  • bequests based on pure exchange 101–2

  • capitalist or entrepreneurial bequests 103–4

  • paternalistic bequests 100–101

  • retrospective bequests 101

  • strategic bequests 102–3

  • voluntary or planned bequests 98–103

• Berglöf, E. and G. Roland 297

• Bergstrom, T.C. 108

• Bernheim, B. Douglas et al. 109

• Bernstein, Lisa 146

• best-efforts clause 125, 128, 184

• Betterment Acts 461

• bias 402, 404–406, 408, 410, 413, 416–19

  • status-quo bias 405–406, 413, 419

• Bigelow, J. 266

• bilateral warranty problems 265–266, 268, 273

• Bishop, William 47, 165–166, 168

• Black-Widow effect 360, 369, 371–3

• Blair, R.D. and D.L. Kaserman 390

• Bohlen, F.H. 462

• boilerplate see standard form contracts

• Bolton, P. and M. Whinston 390

• Bolton, Patrick and Mathias Dewatripont 158

• bond, for franchise 392–4

• Bouckaert, B. and G. De Geest 67, 457, 463

• bounded rationality 64, 402–3, 409–10

• Bracewell-Milnes, Barry 104–5

• breach 315–16, 327, 335–336, 341–348, 455–67

  • efficient breach 455, 466

• Brenner, Gabrielle 108

• Brickley, J.A. 385

• Brickley, J.A. and F.N. Dark 385

• Brickley, J.A., F.H. Dark, and M.S. Weisbach 351

• Brickley, J.A., S. Misra and L. Van Horn 352

• Bridge, M.G. 430

• Brinig, M.F. 374, 376

• Brown, J. 52

• Brownsword, R. 430

• Bruce, Christopher 212

• Buchanan, James and Gordon Tullock 104–5

• Buckley, F.H. 64, 66, 72–3, 442

• bundling 417

• Burrows, Andrew 225

• buy-backs, for franchise 385, 388–9

• Calabresi, G. 429

• Calabresi, G. and J.T. Hirschoff 459

• Calabresi, G. and D. Melamed 363, 429

• Calabresi, Guido and Douglas A. Melamed 68, 70

• calculating damages

  • diminished value 170

  • lost surplus 169–70

  • opportunity cost 170

  • out-of-pocket cost 170

  • substitute price 169

  • see also reliance; restitution; expectation

• Camerer, C. 411

• Campbell, D. and D. Harris 466

• capital-market 384–5

• Carbone, J.R. and M.F. Brinig 371, 373

• Carroll Towing 455

• catchalls 127–128, 131

• cause for entering contract 442

• Caves, R.E. and W.F. Murphy 384

• Chandler v. Webster 219

• characteristics of contracting parties 143–4

• charity 89–90

• p. 473Charpentier, E.M. 429–30

• Che, Y.-K. and D.B. Hausch 244–246, 248

• Che, Yeun-Chu and Chung, Tai-Yeong 189

• Chiappori, P. 322

• Chronopost case 444

• Chu, Cyrus 108

• Chung, Tai-Yeong 189, 193

• civil law of contract 424–50

• civil liability 426

• classic bargain theory 9

• classic economic theory 432

• classical theory of contract 61

• clean break principle 365

• Coase, R.H. 283–4, 328, 336

  • Coase Theorem 161, 432

  • Coasian bargaining 386

  • Coasian solution 466

• cognitive error 198–201

• cognitive psychology 401–21

• cohabitation 360–61, 375–7

• Cohen, George M. 10, 22, 125–51, 432

• Cohen, Lloyd 361–2

• commitment 320–22, 337–338

• common-law marriage 376

• Commons, John R. 282

• comparative institutional analysis 284

• competition 288, 297–298

• competitive equilibrium 258, 261

• complementary assets 287

• completeness of contracts 126–30, 331–3

• Conlisk, J. 407–408

• consensualism 434

• consent, defects of 434

• consequential damages 415

• consideration 80–83, 85–86, 90–94, 443

• constrained choice 62, 64

• consumer biases 416–17

  • exploitation of 418–19

• consumer choice, improvement 419

• consumer contracts 416

• consumer mistakes 417–18

• contextualism 131, 133–4, 136, 141–148

• contra proferentem 122, 138

• contracts

  • annulment 440

  • breach 455–63

  • cause for entering 442

  • error 435–7

  • excusable non-performance 445–6

  • franchise 384–395

  • hardship clause 446

  • holdup problem 239–53, 282, 290, 298

  • incomplete 241, 281, 288–89, 295, 298–300, 314–15, 317, 323, 334–5, 338, 341, 344

  • interpretation 228–41

  • marriage 360–78

  • mistake 435–7, 460

  • modification 73

  • option 239–53, 291–4

  • performance 445–50

  • principal-agent 322

  • public enforcement of 427

  • quasi-contracts 454–67

  • short-term 316–23

• contractual discharge 209, 212–14, 216–19

• contractual mistake and misrepresentation 31–52

• Cooper, R. and T.W. Ross 266–7

• cooperation 300, 314–15, 330–31, 338, 354

• cooperative equilibrium 331, 342

• cooperative investment models of holdup problem 243–7, 315

• cooperative investments 189–90, 344, 346–7

• cooperative specific investment 346

• cooperativeness 221–2

• coordinated adaptation 285–286, 288

• Cooter, R. and T. Ulen 34–5, 57–58, 64–5, 71–2, 429

• Cooter, Robert D. and Melvin Aron Eisenberg 169–166, 173

• Cornu, G. 430

• cost-benefit analysis

  • precontractual investment 12–13, 19

• Cour de cassation 438–436, 444

• court competence and error 145–146

• covenant marriage 363

• Craswell, Richard 10, 12–16, 23, 26–7, 41, 44–5, 63–4, 69–71, 159, 166

• credence properties 256

• credibility 69

• p. 474Cserne, Péter 57–79

  • see Cserne, Péter and Szalai, Akos

• Cserne, Peter and Szalai, Akos 72–3

• Dagan, H., 457, 461

• Dailami, M. and R. Hauswald 334

• Dam, K.W. 425

• damage provisions 180, 182

• damages limitations 216–17

• damnum absque injuria 455–456

• Darby, M. and E. Karny 256

• Davis, G., S. Cretney and J. Collins 372

• Davis, Kevin E. 117

• Dawson, John P. 60, 340, 456, 464

• De Geest, Gerrit 109, 429, 443

  • see Bouckaert, Boudewijn and Gerrit De Geest; De Geest, Gerrit and Roger Van den Bergh

• De Geest, Gerrit and Roger Van den Bergh 58

• debiasing 417

• decision-making strategies 402–4

• default preference 405–406, 419

• default rules 428

  • default versus mandatory rules 135–7

  • majoritarian 412–13

  • non-enforcement 413–14

  • tailored 413–14

• defects of consent 434, 441

• deferred reciprocity 101

• definiteness 316–17, 340

• Del Granado, J.J. 434

• Deutch, Sinai 122

• Dewatripont, M. and E. Maskin 296–7

• Dewatripont, Mathias see Bolton, Patrick and Mathias Dewatripont

• Dickinson, K. 461

• Directive on unfair terms 430, 443, 445

• discount rate 272–3

• disgorgement remedies 464–466

• diversified investments 384

• divorce 360–78

  • fault 360

  • no-fault 360, 362–4

• Dixit, A.K. 432

• Dnes, A. 363, 374, 377, 390, 392–3

• Dnes, A. and N. Garoupa 388

• Dnes, A. and R. Rowthorn 360–61

• Dobbs, D.B. 455

• double bind effect 76

• downstream markets 326

• Draft Common Frame of Reference 437

• Drahozal, C.R. and K.N. Hylton 393

• dual distribution 388–9

• duress 57–79

  • contract modification 73

  • economic duress 66, 75–76

  • engineered vs. non-engineered 66, 68, 71

  • necessity 71–2

• Dutch Civil Code 434, 443, 445

• Dutta, S. and S. Reichelstein 318, 321

• duty to inform 437, 440

• duty to rescue 456–60

• dynamic commitment 295–298

• EC Directive 274

• economics of governance 281

• Edelman, J.J. 464

• Edlin, A. and B. Hermalin 251

• Edlin, Aaron S. and Alan Schwartz 162, 179, 188

• Edlin, Aaron S. and Reichelstein, Stephen 188

• efficient breaches 455, 466

• efficient contracts and efficient nonperformance 155–156, 185

• efficient information exchange 11, 23–4

• efficient rate of precaution 235

• Eidenmuller, Horst 59, 62

• Eisenberg, M. 35, 199, 234–5, 414, 448–9, 466

• Ellison, G. 417

• Emons, W. 266, 268

• endowment effect 405–406, 409

• English law 430

• Epstein, Richard A. 74, 407, 454, 456

• equal division inheritance 106–10

• equilibrium 248–50, 253, 267, 299–300

  • strategies 249

  • cooperative 331

  • perfect 292–3

• error in contract 435–7

• p. 475Esposto, Alfredo G. 64, 66

• estate tax 104–106

• European Commission 339

• Evans, R.B. 248–50, 253

• excusable non-performance of contract 445–446

• expectation 92, 158–9, 186–7, 347

• experience properties 256

• exploitation of nonreaders 119–20

• ex post mechanisms 287–9, 291, 294–5, 301

• express invocation 220–21

• failure to read 118

• Farnsworth, E.A. 9–10, 12–13, 24, 26, 370, 466

• fault divorce 360

• fiduciary contracts 133, 140

• Fischhoff, B. 404

• force majeure 445–446

• foreseeability 225–38

• formalism see textualism

• formation defences 61, 74–5

• formulation error 129

• Fragonard case 439

• franchise

  • arbitration 393

  • at-will 392

  • bond 392–4

  • buy-backs 385

  • contracts 384–395

  • franchising 351–3

  • free riding 391

  • hostages 392–4

  • inter-satellite transfers 388

  • monitoring 386–7

  • resale price maintenance 390–91

  • restrictive covenants 393

  • royalties 385

  • search-cost theory 389

  • sunk investments 394

  • switching-cost 391

  • termination provisions 386, 392

  • tie-ins 391

  • vertical restrictions 390–91

• fraud 436–7

• free riding 431, 391

• free riding, franchise 391

• French Civil Code 429, 435, 441–3, 445–446

• French inheritance law 107–108

• French law 107–108, 429, 431, 435, 441–3, 445–448

• Friedman, David D. 164

• Friedman, Milton 64

• Friedmann, Daniel 161, 163

• frustration of purpose 219

• Fudenberg, D. 299, 317

• Fudenberg, D., B. Holstrom, P. Milgrom 317–18

• Fuller, Lon 81–2

• Fuller, Lon and William Perdue 159, 170

• Fumagalli, C. and M. Motta 326

• Gabaix, Xavier and D. Laibson 121, 417

• Gallin, N.T. and N.A. Lutz 388

• Gal-Or, E. 262

• Garvin, L.T. 415–16

• Geis, George S. 132, 229, 233–4

• Gergen, M. 460

• German Civil Code 429, 434, 443

• Giesel, Grace M. 75

• gifts, wills, and inheritance law 94–114

• Gillette, Clayton P. 118–24

• Gilson, R.J. 330–31, 336

• Goebel v. Linn 446–7

• Goetz, C.J. and Scott, R.E. 13, 117, 155, 172–3, 182–3, 226

• Goff, Lord R. and G.H. Jones 457

• Goldberg, Victor P. 140, 145, 218–19, 337

• Golden Rule 101

• good faith 14, 22, 60, 125, 128, 132, 135, 140, 143, 145, 184, 429–33

• Goode, R. 430

• Gordon, W. 464

• governance mechanisms 283–286

• governance structure 222

• Graham, Daniel A. and Ellen R. Pierce 73

• gratuitous promises 80–94

• greener grass effect 360, 368, 372

• Grosskopf, O. and B. Medina 10, 27–28, 37

• Grossman, S.J. 259, 262

• Grossman, S.J. and O. Hart 350

• Grossman, Hart and Moore 290

• Guthrie et al. 200

• p. 476Haanappel, P.P.C. and E. Mackaay 429

• Hadfield, Gillian K. 145

• Hadley v. Baxendale 225–38

• Hale, Robert L. 75

• Hand, Learned 455

• hardship clause 446

• harm-based liability 465

• Harris, D. and D. Tallon 450

• Hart, O. and J. Moore 241–248, 289–91, 299, 350

• Hasen, R.L. 459

• Hatzis, A.N. 445

• Hatzis, Aristides N. and Eleni Zervogianni 74

• Havighurst, Harold C. 81–2

• Henningsen 115

• Hermalin, Benjamin E. et al. 65–66, 73–4, 128, 289

• Hershovitz, S. 458

• Hesselink, M.W. 429

• heuristics 402, 404–406 408

• hidden actions 298–9, 301

• hierarchical governance 284–286, 297

• Hill v. Gateway 2000 118

• Hillman, R.A. 414–15

• Hirshleifer, H. 34–5

• Hochster v. De La Tour 171

• holdout problem 431

• holdup problem 239–53, 282, 290, 298, 315, 318, 327, 329–30, 336–7, 348, 431

• Holström, B. and J. Roberts 328

• horizontal free riding 385

• hostages, in franchising 392–4

• Hoy, F. 389

• Huber, P.K. 461

• human capital 301, 327, 348

• Hviid, Morton 227

• hybrid governance 284–9, 295, 297–9, 301–2

• hybrid investments 344

• Iacobucci, E. 391

• imperfect information 64, 67

• impossibility and impracticability 207–24

• incentive intensity 285, 299

• incentives

  • communication 227–9

  • disclosure and information acquisition 32–4

  • formation 163–4

  • holdup 68

  • incentive-based theories of duress 65–7

  • incentives to bequests 99–100

  • negotiating 12, 24–26

  • performance 155

• incentives and contract length 322

• incomplete contracts 130–32, 216–17, 241, 281, 288–9, 295, 298–300, 314–15, 317, 323, 334–5, 338, 341, 344

• incomplete divesture 460–64

• incomplete information 319

• indifference curve 258, 260, 264, 465

• indifference principle 448–9

• information

  • acquisition 33–4, 37

  • asymmetric information 129, 117–18, 122, 135, 140, 143–4, 197–9, 212, 228, 298, 318–19, 325, 338

  • disclosure, voluntary 36–38

  • incentives to acquire information 32–4, 226

  • productive and redistributive information 34–5

  • renegotiation 220

  • transfer 259

• information-forcing default 228–9

• institutional competence 69–70

• institutional economics 297, 432

• intentional ambiguity 129, 226–7

• inter vivos transfers 97, 99, 105

• interpretation and implied terms in contract law 125–51

• interpretation of contracts 338–41

• inter-satellite transfers, of franchises 388

• investment 240–45, 248–52, 262, 265, 282, 290–91, 293–4, 296–7, 314, 318, 323, 326–34, 336–7, 343–9, 384

  • cooperative 344, 346–7

  • diversified 384

  • hybrid 344

  • selfish 344–5

  • sequential 250–51

  • p. 477simultaneous 250

  • specific 314, 318, 326–33, 336–7, 343–348

• Issacharaoff, S. 408–9, 411

• Jackson, Thomas H. 171

• Johnston, J.S. 10, 19, 24, 119, 227, 232

• joint fault and multiple contingencies 142–3

• Jolls, Christine 37, 374, 442

• Jolls, C. and C.R. Sunstein 410

• Jolls, C., C.R. Sunstein and R. Thaler 401–2

• Joskow, Paul 210–12, 292, 328, 330, 335

• Kahneman, D., J.L. Knetsch and R. Thaler 405

• Kaldor-Hicks efficiency 363, 456, 460

• Kaldor-Hicks test see allocative efficiency

• Kambhu, J. 266, 268

• Kaplow, L. and S. Shavell 289

• Katz, A. 13, 15–16, 26, 117, 141, 143

  • see Hermalin, Benjamin E. et al.

• Keily, T. 430

• Kennedy, Duncan 61, 64

• Klass, G. see Ayres, I. and G. Klass

• Klausner, Michael 117

• Klein, B. 119, 282, 362, 392

• Klein, B. and L.F. Saft 391

• Klein, B., R.G. Crawford, and A.A. Alchain 350

• Klick, J., B. Kobayashi and L. Ribstein 352, 386

• Knetsch, J. 367

• Knight, F.H. 282, 301

• Kornhauser, Lewis 117

• Korobkin, R. 120, 406, 413–14, 416–17

• Korobkin, R. and T. Ulen 401, 403, 407–10, 413–14, 418–19

• Kostritsky, J.P. 10, 14, 22–3, 142

• Kötz, Hein 58–60, 443

• Krell v. Henry 207–208, 213, 219

• Kronman, Anthony T. 33–4, 64, 66, 165, 448

• Kull, Andrew 82–3, 168, 462–4, 466

• La Porta, R. 425

• Laffont, Jean-Jacques and David Martimort 158

• Lafontaine, F. 385, 388–90

• Lafontaine, F. and K. Shaw 352, 389

• Lafontaine, F. and M. Slade 350

• Landes, W. and R. Posner 45–46, 458

• Lando, H. and C. Rose 450

• Langevoort, D.C. 401

• least-cost-avoider 15–16, 22

• Leff, Arthur A. 122

• legal deterrence, theory of 41–2

• lésion 64, 440–42

• Levmore, S. 457–9

• liability, benefit-based 465

• liability, harm-based 465

• liability, limitation clauses 443

• libertarian paternalism 412, 420

• limitation clause on liability 443

• linguistic over-determination 289

• Lipshaw, Jeffrey 130, 139

• liquidated damages 166–7, 178, 414–15, 445

• literalism see texualism

• Litvinoff, S. 429

• Loasby, B. 287

• Long, R.A. 457

• long-term contracts 208, 210, 217–19, 221, 223, 281–302, 314–54

• Lyon, T.P. and E. Rasmusen 245–248

• Macaulay, Stewart 218, 374

• Mackaay, E. 425, 430

• Mackaay, E. and V. Leblanc 433

• Macneil, Ian R. 163, 374–5

• Mahoney, Paul G. 41, 155–77, 166

• majoritarian default rule 228–30, 412–13

• mandatory rescue 458

• mandatory rule 428

• mandatory warranties 428

• Mann, D.P. and J.P. Wissink 266, 268

• Mann, R.J. 19, 120

• marital

  • assets 362

  • breach 363–78

  • breach remedies 366–71

• market

  • downstream markets 326

  • equilibrium 260

  • p. 478failure 117–18, 122

  • governance 284–286, 297

• Marotta-Wurgler, Florencia 121–2

• marriage

  • contracts 360–78

  • modification of contract 374

  • partnership model 371

  • post-nuptial agreements 375

  • pre-nuptial agreements 375

  • same-sex 377

• Martimort, David see Laffont, Jean-Jacques and David Martimort

• Martin, R.E. 388–9

• Marvel, H. 391

• Maskin, E. and J. Moore 289

• Maskin, Eric and Jean Tirole 191

• material adverse change 184

• Mathewson, G.F. and R.A. Winter 385–7

• Matouschek, N. and I. Rasul 362

• Mattei, U. 445

• Maxcy, J.G., R.D. Fort and A.C. Krautmann 324

• McInnes, M. 464

• Mechoulan, S. 362

• Medina, B. see Grosskopf, O. and B. Medina

• Melamed, Douglas A. see Calabresi, Guido, and Dougas A. Melamed

• Ménard, C. 283, 286–7

• Miceli, T.J. 374

• Milhaupt, C.J. and K. Pistor 425

• Millon, D. 413

• Mineral Park 208

• Minkler, A. 389

• minoritarian default rule 229

• misperception-based pricing 417

• misrepresentation 437

  • fraudulent misrepresentation 31, 41–46

  • innocent misrepresentation 31, 50–52

  • masqueraders 87

  • negligent misrepresentation 31, 47–50

  • optimal level of care 47–48

  • promissory representations 46

• Missouri Furnace v. Cochran 171

• mistake 31, 37–9, 61, 64, 460–61, 435–7

  • cross-purpose mistakes 40

  • consumer 417–18

• mitigation of damages 449

• modification of contracts 59, 93

• modification of marriage contracts 374

• money damages 239

• money-back warranties 256

• monitoring, of franchise 386–7

• monopoly 64, 71, 73, 116–17

• Moore, J. and R. Repullo 289

• moral consideration 94

• moral hazard 289, 295, 298, 301, 321–2, 337, 386, 394, 431, 436, 446

• multidimensional pricing 418

• Muris, Timothy J. 73, 140

• Muthoo, A. 292

• mutual assent, mutual consent 18–19, 61, 122

• Napoleonic inheritance 106–7

• Nash 267, 289, 299

• need-based remedy for marital breach 372–3

• negative externalities 64

• negotiorum gestio 456

• neoclassical economics 282, 284, 287

• Netherlands Civil Code 445

• no-fault divorce 360, 362–4

• Nöldeke, G. and K.M. Schmidt 241–3, 250–51, 294

• Noll, J. 266

• nominal consideration 91

• non-compete 341, 348–9

• non-cooperative game 288

• non-enforcement default rules 413–14

• non-performance 341–3, 445–446

• non-rational behavior 402, 410

• Norton, S.W. 385

• no-trade penalty or outcome 191

• Nozick, Robert 62

• objective good faith 430

• OECD 106, 110

• offer of reward 433

• Ogus, Anthony 32

• old-age security 101–2

• opportunistic behavior 11, 20–23, 40–41, 73–4, 139–42, 159, 166, 168–9, 174, 221–2, 431–3, 436, 442, 449

• optimal damage measure 26–7, 163

• p. 479optimal default cap 230–31

• optimal precision 234

• option contracts 239–53, 291–4

• organizational costs 385

• Ourliac, P. and J. de Malafosse 431

• outside option model 293

• over-investment 11–12, 18, 27–28, 322–3, 348–9

• Palmer, G.E. 464

• Pareto principle 67, 76, 101, 156

• Parkman, A. 363

• parol evidence rule 126, 134, 137, 141

• partial performance 167, 170

• partnership model of marriage 371

• paternalism 410–12, 420

  • asymmetric 411

  • libertarian 412, 420

• penalties for failure to rescue 458

• penalty

  • clauses 187, 190, 193–5, 293, 444–5

  • doctrine 414–15

  • defaults 226–30, 232, 235–236

• perfect equilibrium game 292

• perfect tender rule 168–9

• performance of contract 445–50

• Perloff, Jeffrey M. 212

• Petty, A.R. 464

• Pierce, Ellen R. see Graham, Daniel A. and Ellen R. Pierce

• Pineau, J. 430–31

• plain meaning rule 134, 138

• Poitevin, M. 325

• pooling resources 287, 297

• Popenhoe, D. 377

• Porat, A. 458

• Posner, Eric 228–9, 233, 415

• Posner, Richard A. 65, 74, 133–4, 140, 209–12, 362, 408–9, 429, 447, 455, 463, 466

  • see Landes, W. and R. Posner

• post-nuptial agreements 375

• Poussin case 437–9

• precontractual liability 9–28

• preliminary agreement 13–14

• Prentice, Robert A. 80–95

• pre-nuptial agreements 375

• price adjustments 216–17

• price reduction warranties 256, 274

• pricing, multidimensional 418

• Priest, George L. 168, 265, 428

• primogeniture 108

• principal-agent contracts 322

• prisoner’s dilemma 220, 299–300

• private ordering paradigm 63–5

• Probert, R. and J. Miles 361, 376

• Probst, Thomas 58

• product complexity models of holdup problem 243–7

• profit-sharing agreements 385, 387

• promissory estoppel

  • bargaining power 16

  • classic bargain theory 9–10

  • opportunism deterrence 23

  • optimal damage measure 26

  • protection during negotiations 13, 20

  • trust protection 21

• Prosser, W. and W. Keeton 459

• public enforcement of contracts 427

• public order 428

• quality premiums 273

• quasi-contracts 167, 454–67

• quasi-rents 323, 327, 343

• Quebec Civil Code 429, 434–5, 441–3, 445–446, 448

• Quebec Consumer Protection Act 442

• Rachlinsky, J.J. 412, 415

• Radin, Margaret 76

• Rasmusen, E. and I. Ayres 38–9

• Rasmusen, E. see Rasmusen, E. and I. Ayres

• Rasmusen, E.B., J.M. Ramseyer and J.S. Wiley Jr. 325

• rational choice theory 401–2, 407–408

• redistributive equity 105

• refinance 296–298

• regret contingency 155–156

• relational contracting 289, 295, 299–300, 314

• relation-specific investments 12, 14, 20, 22

• reliance 10, 156–7, 159–64, 168–70, 455

  • bargaining power and timing 15

  • bilateral reliance 17

  • fraudulent misrepresentation 44–5

  • gift promises inducing reliance 89

  • liability regimes 17–18

  • p. 480optimal investments 13

  • precontractual reliance 11–13

  • unilateral reliance 14–16

  • see optimal damage measure

• reliance damages 345–346

• reliance damages for marital breach 366–9

• remedies 155–77, 315–16, 335, 341–348, 345–346, 437, 454

• remedies for marital breach 366–73

• renegotiation 156, 161, 163–166, 188–90, 240–53, 291–5, 298–9, 316, 318–22, 327, 333–338, 344, 346–9

• Renner, Shirley 217

• repeat players 115–16

• repeated hidden action 281

• replacement warranties 256

• reputation 129–30, 220, 269–72

• reputational equilibrium 270

• resale price maintenance, franchise 390–91

• rescission 35–36, 167–9

• rescue 454, 456–7

• Restatement (Second) of Contracts 208, 430

• 175(1) 58

• Restatement (Third) of Restitution 466

• restitution 57, 67, 159–60, 167–9, 174, 347, 454–458, 461–3

• restitution damages for marital breach 369–71

• restrictive covenants in franchise agreements 393

• revolving-offer bargaining 292–3

• reward, offer of 433

• risk and contract length 322

• Roe, M.J. 425

• Roe, M.J. and J.I. Siegel 425

• Rolland, L. 430

• Rosenfield, Andrew 209–12

• Rosental, P.A. 108

• Rowthorn, R. 362

• royalties, of franchise 385

• Rubin, P.H. 384–5, 387, 459–60

• Rubinstein equilibrium 249

• Rubinstein-Stahl 292

• rule of absolute liability 207

• Saiman, C. 457

• same-sex marriage 377

• Samuelson, W. and R. Zeckerhauser 405

• sanctions 155

• satisficing 403

• Savage, L.J. 282, 301

• Schmitz, Patrick W. 190–91

• Schwartz, A. and R.E. Scott 10, 13, 14, 25, 27, 128, 134, 136, 142–5, 340

• Schwartz, Alan 74, 184–5

  • see Schwartz, A. and R.E. Scott; Edlin, Aaron S. and Alan Schwartz

• Schwartz, Alan and Louis L. Wilde 118–19

• Schweizer, Urs 162–3

• Scott, E.S. and R.E. Scott 375

• Scott, R.E. 10, 219–20, 339

  • see Schwartz, A. and R.E. Scott; Goetz, C.J. and R.E Scott.

• Scott, Robert E. and George G. Triantis 159–60

• screening mechanisms 297

• seal 91

• search properties 256

• search-cost theory, of franchise 389

• Segal, I. 244–5, 247–248

• Segal, I. and M.D. Whinston 325

• selfish investments 344–5

• Selten, R. 292

• sequential contracting behavior 121

• sequential investment 250–51

• Shaked, A. and J. Sutton 246–248, 250, 252

• Shavell, Steven 49, 65–66, 68–9, 71–2, 127, 156, 158, 162, 175, 345

• Shell, R.G. 10, 21–2

• Sherwin, E. 461

• shirking 385, 431

• short-term contracts 316–23

• shrouded attributes 417

• signaling equilibrium 197–198

• Silver, C. 456

• Simon, Herbert 217, 402

• simultaneous investment 250

• Singer, J. 371

• Slovic and Lichtenstein 404

• Smith, V. 361

• Smith, J. and R. Smith 39

• p. 481Smith, Lionel 461

• Smythe, Donald J. 207–24

• social welfare 290–91, 294, 299–300

• soft-budget constraint syndrome 289, 295–298

• Sovern, J. 419

• specific investments 314, 318, 326–33, 336–7, 343–348

• specific performance 164–166, 239, 294, 342, 348, 448–50

• Spence, M. 259, 262

• Spitzer, M. and E. Hoffman 407

• standard form contracts 115–24

• status-quo bias 405–406, 413, 419

• Statute of Frauds 463

• Step-Saver Data Systems, Inc. v. Wyse Technology 118

• Stewart, Hamish 61, 63, 67

• stickiness 232–3

• Stigler, G. 42

• stipulated damages 180, 182–4, 186, 189, 194–5, 198–202

• stochastic damages 231–2

• Stole, Lars A. 184–5

• Stolle, Dennis P. and A.J. Slain 118

• subjective good faith 430

• subsequent improvement warranties 256, 274

• substitute assets 287

• Suez Canal cases 213, 219

• sunk cost effect 418

• sunk investments, of franchise 394

• Sunstein, C.R. 401, 410

• Sunstein, C.R. and R.H. Thaler 412, 419–20

• superior risk bearer 131, 137–9, 142

• suppletive law 428, 446

• switching-cost, of franchise 391

• Sykes, Alan O. 213–14

• Szalai, Akos see Cserne, Péter and Szalai, Akos

• tailored default rules 226, 413–14

• taxing bequests see estate tax

• Taylor v. Caldwell 207

• Taylor, James Stacey 63

• termination at will 353

• termination provisions, of franchise 386, 392

• Tesler, L. 391

• textualism 128, 131, 133, 136, 142–9, 434

• Thaler, R. 405–406, 418

• Thompson, R.S. 388–9

• threat of violence or fear 440

• tie-ins, franchise 391

• timing of foreseeability determination 234–5

• Tirole, J. 295

• Tomes, Nigel 107–108

• total and partial breach 167

• trading opportunity 246–9, 252–3

• transaction cost theory 115–16, 282, 287, 330–31, 350, 384–5, 392

• transferable control 295

• Trebilcock, Michael 366, 429

• Trebilcock, Michael J. 63–4, 67, 76

  • see Aivazian, Varouj A. et al. 73

• Triantis, George G. 73, 214–16 see also Scott, Robert E. and George G. Triantis

• Trimarchi, Pietro 216–17

• Tullock, Gordon see Buchanan, James and Gordon Tullock

• Tversky, A. and D. Kahneman 404, 406

• typology of default rules 229

• UCC Article 2 93, 179–80, 208

• Ulen, T. 408 see also Cooter, R. and T. Ulen

• unconscionability 60, 64, 74, 417, 430

• underinvestment 294–5, 323

• undue influence 58–61

• unforeseeability 446–7

• Unidroit Principles of International Commercial Contracts 430

• Uniform Written Obligations Act 91

• unjust enrichment 439, 454–67

• unverifiable information 181–4, 186–188, 190, 192

• use-pattern mistakes 418

• valuation 290

• van Wijck, Peter 225–38

• verifiability of non-performance 341–3

• vertical disintegration 330

• vertical integration 328–9, 350

• vertical restrictions to franchising 390–91

• p. 482Vienna Sales Convention 430

• volition, theory of 57

• voluntariness 57–58, 61–2, 64, 67, 70–71, 74–5

• Von Neumann, J. and O. Morgenstern 282

• von Thadden, E. 298

• Wade, J.W. 457

• Walt, Steven 178–206, 216

• warranties 256–74

  • mandatory 428

  • money-back 256

  • price reduction 256, 274

  • replacement 256

  • subsequent improvement 256, 274

• Wehrt, K. 269

• Weinrib, E.J. 460

• Weitzman, L.J. 371

• Westinghouse case 210–11

• White, Michelle 213

• Wickelgren, A.L. 246–248

• will theory see classical theory of contract

• Williams, D. 352

• Williamson, O.E. 217–18, 283–286, 321, 327, 350, 374, 393, 432

• Wils, W. 19–20

• Windsperger, Cochet and Ehrmann 394

• Wittman, D. 427, 429, 432–4, 457, 459, 465

• Wonnell, Christopher T. 36, 38, 67, 455–7, 462

• Zervogianni, Eleni see Hatzis, Aristides N. and Eleni Zervogianni

• Zhou, Q. 32–3, 36, 38, 41, 43–46, 31–52

• Zimmerman, R. 433