Legal and Economic Perspectives on Contracts
| Peter Klein |
Law professor Lewis Kornhauser and economist Bentley MacLeod have teamed up to provide a multidisciplinary perspective on contracts:
Contracts between Legal Persons
Lewis A. Kornhauser, W. Bentley MacLeod
NBER Working Paper No. 16049
Issued in June 2010
Contract law and the economics of contract have, for the most part, developed independently of each other. In this essay, we brieﬂy review the notion of a contract from the perspective of lawyer, and then use this framework to organize the economics literature on contract. The review thus provides an overview of the literature for economists who are interested in exploring the economic implications of contract law. The title, Contracts between Legal Persons, limits the review to that part of contract law that is generic to any legal person. A legal person is any individual, ﬁrm or government agency with the right to enter into binding agreements. Our goal is to discuss the role of the law in enforcing these agreements under the hypothesis that the legal persons have well deﬁned goals and objectives.
The paper is unfortunately behind the NBER firewall. Note in the comments if you find an ungated version.
Gordon Smith’s chapter in the forthcoming Elgar TCE Handbook, “Legal Precursors of Transaction Cost Economics,” is also worth a look.