Economics of Contract Law
ECONOMIC PRINCIPLES OF LAW, Cento Veljanovski, Cambridge University Press, 2007
79 Pages Posted: 29 Jul 2007 Last revised: 23 Jan 2020
Date Written: July 1, 2006
This paper provides an introduction to the economics of contract law. It begins by setting out the basic elements of the economics of contract, contractual problems, and abuses. It then examines the purpose of contract law, its various doctrines (eg. consideration, disclosure and mistake) and remedies (specific performance and different damage measures such as expectation, restitution, completion, liquidated and non-pecuniary damages) evaluated in terms of their impact on efficient breach, efficient reliance, risk-bearing and compensation. The discussion serves as a non-technical introduction for lawyers to this important branch of the common law. The paper forms the contract chapter of the Economic Principles of Law published in June 2007. The full text can be obtained via the Cambridge University Press website.
Keywords: economics of law, contract, contract damages
JEL Classification: K10, K11, K14, K21, K32
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