{"product_id":"more-is-less-maija-halonen-akatwijuka-9781009396073","title":"More Is Less: Why Parties May Deliberately Write Incomplete Contracts","description":"Why are contracts incomplete? Transaction costs and bounded rationality cannot be a total explanation since states of the world are often describable, foreseeable, and yet are not mentioned in a contract. Asymmetric information theories also have limitations. We offer an explanation based on 'contracts as reference points'. Including a contingency of the form, 'The buyer will require a good in event E', has a benefit and a cost. The benefit is that if E occurs there is less to argue about; the cost is that the additional reference point provided by the outcome in E can hinder (re)negotiation in states outside E. We show that if parties agree about a reasonable division of surplus, an incomplete contract is strictly superior to a contingent contract. If parties have different views about the division of surplus, an incomplete contract can be superior if including a contingency would lead to divergent reference points.\u003cbr\u003e\u003cbr\u003e\u003cb\u003eAuthor:\u003c\/b\u003e Maija Halonen-Akatwijuka, Oliver Hart\u003cbr\u003e\u003cb\u003eISBN-10:\u003c\/b\u003e 1009396072\u003cbr\u003e\u003cb\u003eISBN-13:\u003c\/b\u003e 9781009396073\u003cbr\u003e\u003cb\u003ePublisher:\u003c\/b\u003e Cambridge University Press\u003cbr\u003e\u003cb\u003eLanguage:\u003c\/b\u003e English\u003cbr\u003e\u003cb\u003ePublished:\u003c\/b\u003e 05\/23\/2024\u003cbr\u003e\u003cb\u003ePages:\u003c\/b\u003e 34\u003cbr\u003e\u003cb\u003eFormat:\u003c\/b\u003e Paperback\u003cbr\u003e\u003cb\u003eWeight:\u003c\/b\u003e 0.13lbs\u003cbr\u003e\u003cb\u003eSize:\u003c\/b\u003e 9.00h x 6.00w x 0.07d","brand":"Maija Halonen-Akatwijuka","offers":[{"title":"Paperback","offer_id":46173152411903,"sku":"9781009396073","price":22.0,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0662\/2982\/9887\/files\/img_36eef524-e0ce-4df1-9188-f96f55978990.jpg?v=1727180143","url":"https:\/\/www.whiterainbookhouse.com\/products\/more-is-less-maija-halonen-akatwijuka-9781009396073","provider":"WR Book House","version":"1.0","type":"link"}