Law and Economics

  1. The Economics of Contract Law
    1. Economic Purpose of Contracts
      1. Facilitating Mutually Beneficial Exchange
        1. Risk Allocation
          1. Encouraging Reliance
            1. Encouraging Investment
              1. Coordination Function
              2. Contract Formation
                1. Offer and Acceptance
                  1. Communication Requirements
                    1. Meeting of Minds
                    2. Consideration
                      1. Economic Value
                        1. Bargain Requirement
                        2. Capacity
                          1. Economic Rationale
                          2. Duress and Undue Influence
                            1. Voluntariness
                              1. Economic Coercion
                            2. Contract Performance and Breach
                              1. Efficient Breach Theory
                                1. When Breach Increases Total Welfare
                                  1. Conditions for Efficiency
                                  2. Remedies for Breach
                                    1. Expectation Damages
                                      1. Calculating Lost Benefits
                                        1. Making Plaintiff Whole
                                        2. Reliance Damages
                                          1. Compensation for Preparatory Costs
                                            1. Out-of-Pocket Expenses
                                            2. Restitution Damages
                                              1. Preventing Unjust Enrichment
                                                1. Disgorgement of Benefits
                                                2. Specific Performance
                                                  1. When Monetary Damages Inadequate
                                                    1. Unique Goods and Services
                                                    2. Liquidated Damages
                                                      1. Pre-Agreed Compensation
                                                        1. Enforceability Standards
                                                        2. Penalty Clauses
                                                          1. Deterrence Function
                                                            1. Enforceability Issues
                                                        3. Contract Interpretation
                                                          1. Default Rules
                                                            1. Gap-Filling Function
                                                              1. Efficiency Considerations
                                                              2. Mandatory Rules
                                                                1. Limits on Party Autonomy
                                                                  1. Policy Justifications
                                                                  2. Implied Terms
                                                                    1. Judicial Gap-Filling
                                                                      1. Economic Efficiency
                                                                    2. Information Problems in Contracts
                                                                      1. Asymmetric Information
                                                                        1. Pre-Contractual Information
                                                                          1. Post-Contractual Information
                                                                          2. Mistake
                                                                            1. Unilateral Mistake
                                                                              1. Mutual Mistake
                                                                                1. Impact on Contract Validity
                                                                                2. Fraud and Misrepresentation
                                                                                  1. Economic Effects of Deception
                                                                                    1. Remedies and Deterrence
                                                                                    2. Duty to Disclose
                                                                                      1. Information Asymmetries
                                                                                        1. Efficiency Considerations

                                                                                    Previous

                                                                                    4. The Economics of Property Law

                                                                                    Go to top

                                                                                    Next

                                                                                    6. The Economics of Tort Law