Law and Economics Commons^™

The Strategic Structure Of Offer And Acceptance: Game Theory And The Law Of Contract Formation, Avery W. Katz

Faculty Scholarship

The purpose of this article is to promote a particular research program; namely, the use of game theory to analyze the law of contract formation. Although I will often simply speak of offer and acceptance in my discussion, I mean to refer to a broader set of issues than are commonly denoted by this doctrinal label. My program transcends the narrow issue of whether particular communications technically should be classified as offers and acceptances, and includes questions often analyzed under the rubrics of implication and interpretation. At its broadest, my argument addresses all legal rules that answer two types of …

Reflections On Fuller And Perdue's The Reliance Interest In Contract Damages: A Positive Economic Framework, Avery W. Katz

Faculty Scholarship

Fuller and Perdue's classic article, The Reliance Interest in Contract Damages, is regarded by many contemporary contracts scholars as the single most influential law review article in the field. For those of us who teach and think about contracts from the perspective of law and economics, the consensus would probably be close to unanimous. The article displays an approach highly congenial to an economic perspective. The connection goes beyond Fuller and Perdue's explicitly functional approach to law (which law and economics shares with other schools of thought descended from the legal realists) and beyond Fuller and Perdue's focus on …

Clarifying The Record: A Comment, Victor P. Goldberg

Faculty Scholarship

In their recent article in this journal, Boudreaux and Ekelund [1987] ha presented a distorted characterization of some of my work on the economics o regulation. The editor of this journal has graciously offered me the opportunity to respond to their criticisms and to redress some ambiguities, real or imagine in my earlier work.

Quantity And Price Adjustment In Long-Term Contracts: A Case Study Of Petroleum Coke, Victor P. Goldberg, John R. Erickson

Faculty Scholarship

Much economic activity takes place within a framework of complex, long-term contracts. While economists have shown increased interest in these contracts, surprisingly little is known about them, or, indeed, about how to analyze the contracting activity of private economic actors. A case study of the actual contracts used in one industry could provide sorely needed data about the way in which reasonably clever businessmen and lawyers cope with problems scholars might consider intractable. In this article, we provide such an analysis of contracts concerning a particular product – petroleum coke. We focus on the problems of quantity and price adjustment. …

Measuring Sellers' Damages: The Lost-Profits Puzzle, Charles J. Goetz, Robert E. Scott

Faculty Scholarship

A buyer repudiates a fixed-price contract to purchase goods, and the seller sues for damages. How should a court measure the seller's loss? The answer seems simple: The seller should be awarded damages sufficient to place it in the same economic position it would have enjoyed had the buyer performed the contract. But the seductive conceptual simplicity of the compensation principle disguises substantial practical problems in measuring seller's damages.

Contract law has traditionally minimized measurement difficulties by basing damages in most cases on the difference between the contract price and market value of the repudiated goods. The common law courts …