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This paper, which will appear as a chapter in the forthcoming Handbook of Law and Economics (A.M. Polinsky & S. Shavell, eds.), surveys major issues arising in the economic analysis of contract law. It begins with an introductory discussion of scope and methodology, and then addresses four topic areas that correspond to the major doctrinal divisions of the law of contracts. These areas include freedom of contract (i.e., the scope of private power to create binding obligations), formation of contracts (both the procedural mechanics of exchange, and rules that govern pre-contractual behavior), contract interpretation (what consequences follow when agreements are ambiguous or incomplete), and enforcement of contractual obligations. For each of these sections, we address the economic analysis of particular legal rules and institutions, and, where relevant, connections between legal arrangements and associated topics in microeconomic theory, including welfare economics and the theory of contracts.
Other publications by this author
- When is a Willful Breach "Willful"? The Link Between Definitions and Damages
- When is a Willful Breach "Willful"? A Puzzle and Two Different Economic Solutions
- Contract Law
- Expectation Damages and Contract Theory Revisted
- Taking Information Seriously: Misrepresentation and Nondisclosure in Contract Law and Elsewhere
- Taking Information Seriously: Misrepresentation and Nondisclosure In Contract Law and Elsewhere
- The “Incomplete Contracts” Literature and Efficient Precautions
- In That Case, What Is the Question? Economics and the Demands of Contract Theory
- Instrumental Theories of Compensation: A Survey
- Kaplow and Shavell on the Substance of Fairness (Sympoium on Louis Kaplow and Steven Shavell, Fairness versus Welfare)
Author
- Richard Craswell
- Stanford Law School
- rcraswel@stanford.edu
- 650 725.8542