Private ordering, collective action, and the self-enforcing range of contracts

Contract enforcement is acknowledged as a major issue in Law and in Economics. Contrasting substitution and complementary perspectives with respect to the role of private vs. public enforcement institutions, this article analyses how contract law can support private institutions, and enhance economi...

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Bibliographic Details
Published in:European journal of law and economics 2010-02, Vol.29 (1), p.131-153
Main Authors: Menard, Claude, Mazé, Armelle
Format: Article
Language:English
Subjects:
Agreements
Anti-trust legislation
Cartels
Cattle industry
Cattle production
Coalitions
Collective action
Collective organization
Commercial Law
Contract law
Contracts
D23
D74
Economic law
Economic theory
Economics
Economics and Finance
Empirical research
Enforcement
European Integration
K12
L14
Law
Law and Economics
Private enforcement
Public Finance
Q13
Regulation
Reputations
Self regulation
Studies
Transaction costs
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Summary:Contract enforcement is acknowledged as a major issue in Law and in Economics. Contrasting substitution and complementary perspectives with respect to the role of private vs. public enforcement institutions, this article analyses how contract law can support private institutions, and enhance economic efficiency. With multilateral agreements at stake, self-regulation and reputation mechanisms at the core of private ordering have limitations that collective organizations backed by the Law help to overcome. The analysis is substantiated by empirical data from the cattle industry. Our results suggest the need for a broader approach to contract regulation by legal scholars and antitrust-authorities.
ISSN:0929-1261
1572-9990
1572-9346
DOI:10.1007/s10657-009-9114-x