• Economics
  • Published 2002

The Economics of Contracts

  title={The Economics of Contracts},
  author={Eric Brousseau and Jean-Michel Glachant},
A contract is an agreement under which two parties make reciprocal commitments in terms of their behavior to coordinate. As this concept has become essential to economics in the last 30 years, three main theoretical frameworks have emerged: 'incentive theory', 'incomplete-contract theory' and 'transaction-costs theory'. These frameworks have enabled scholars to renew both the microeconomics of coordination (with implications for industrial organization, labor economics, law and economics… CONTINUE READING