Breach Remedies Including Hybrid Investments

Arbeitspapier

We show that parties in bilateral trade can rely on the default common law breach remedy of '€˜expectation damages' to induce simultaneously ?rst-best relationship-speci?c investments of both the sel?sh and the cooperative kind. This can be achieved by writing a contract that speci?es a suffciently high quality level. In contrast, the result by Che and Chung (1999) that '€˜reliance damages' induce the ?rstbest in a setting of purely cooperative investments, does not generalize to the hybrid case. We also show that if the quality speci?ed in the contract is too low, '€˜expectation damages' do not necessarily induce the ex-post effcient trade decision in the presence of cooperative investments.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: SFB/TR 15 Discussion Paper ; No. 282

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: breach remedies ; incomplete contracts ; hybrid investments ; cooperative investments ; sel?sh investments

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Göller, Daniel ; Stremitzer, Alexander
• Ereignis: Veröffentlichung
• (wer): Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
• (wo): München
• (wann): 2009

Weitere Informationen

• DOI: doi:10.5282/ubm/epub.13272
• Handle: http://hdl.handle.net/10419/93816
• URN: urn:nbn:de:bvb:19-epub-13272-0
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ