The Impact of Incomplete Contracts on Economics

by Philippe Aghion (Editor), Mathias Dewatripont (Editor), Patrick Legros (Editor), Luigi Zingales (Editor)

Overview

The 1986 article by Sanford J. Grossman and Oliver D. Hart titled "A Theory of Vertical and Lateral Integration" has provided a framework for understanding how firm boundaries are defined and how they affect economic performance. The property rights approach has provided a formal way to introduce incomplete contracting ideas into economic modeling. The Impact of Incomplete Contracts on Economics collects papers and opinion pieces on the impact that this property right approach to the firm has had on the economics profession.

Product Details

ISBN-13:	9780199826216
Publisher:	Oxford University Press
Publication date:	01/21/2016
Pages:	440
Product dimensions:	6.10(w) x 9.10(h) x 1.20(d)

About the Author

Philippe Aghion is the Robert C. Waggoner Professor of Economics at Harvard University and a fellow of the Econometric Society and of the American Academy of Arts and Sciences.

Mathias Dewatripont is Director of the National Bank of Belgium, Professor of Economics at the Université libre de Bruxelles. and a fellow of the Econometric Society and of the American Academy of Arts and Sciences

Patrick Legros is Professor of Economics at the Université libre de Bruxelles in Belgium and a fellow of its research center ECARES.

Luigi Zingales is Robert C. McCormack Distinguished Service Professor of Entrepreneurship and Finance and Charles M. Harper Faculty Fellow at the University of Chicago Booth School of Business.

Table of Contents

PART 1: Perspectives on Grossman and Hart 1986

(1) Introductory Remarks on Grossman and Hart, JPE, 1986
John Moore (University of Edinburgh)

(2) Grossman-Hart (1986) as a Theory of Markets
Bengt Holmström (MIT)

(3) Remarks on Incomplete Contracting
Jean Tirole (Toulouse School of Economics)

(4) Property Rights and Transaction Cost Theories
Steven Tadelis (University of California-Berkeley and eBay Research Labs)

(5) Grossman and Hart (1986) and Applied Theory
Thomas Hubbard (Kellogg School of Management, Northwestern University)

PART 2: Incomplete Contracts and Firm Boundaries

(6) Incomplete Contracts and Firm Boundaries: New Directions
Wouter Dessein (Columbia University)

(7) Discussion of Wouter Dessein's "Incomplete Contracts and Firm Boundaries: New Directions"
Francine Lafontaine (University of Michigan)

(8) Comment on "Incomplete contracts and Firm Boundaries: New Directions" by Wouter Dessein
Michael D. Whinston (MIT)

PART 3: Incomplete Contracts and Internal Organization

(9) Incomplete Contracts and the Internal Organization of Firms
Phillipe Aghion (Harvard University), Nicholas Bloom (Stanford University), John Van Reenen (London School of Economics)

(10) Comments on Aghion, Bloom and Van Reenen "Incomplete Contracts and the Internal Organization of Firms," P.
John Roberts (Stanford University)

(11) The Empirical Implications of the Grossman-Hart Model: Comments on "Incomplete Contracts an the Internal Organization of Firms," by P. Aghion, N. Bloom and J. Van Reenen
W. Bentley McLeod (Columbia University)

PART 4: Incomplete Contracts and Corporate Finance

(12) Corporate Finance, Incomplete Contracts, and Corporate Control
Patrick Bolton (Columbia University)

(13) Discussion of Patrick Bolton's "Corporate Finance, Incomplete Contracts, and Corporate Control"
Efraim Benmelech (Kellogg School of Management, Northwestern University)

(14) Why Incomplete Contract is Important for Finance
Luigi Zingales (The University of Chicago Booth School of Business)

PART 5: Incomplete Contracts and Business Firms

(15) Oliver Hart's Contributions to the Understanding of Strategic Alliances and Technology Licensing
Josh Lerner (Harvard University)

(16) Incomplete Contracts and Venture Capital
Steve Kaplan (The University of Chicago Booth School of Business)

(17) Incomplete Contracts and the Role of Small Firms
Jeremy C. Stein (Harvard University)

PART 6: Incomplete Contracts and Industrial Organization

(18) Contracts, Ownership and Industrial Organization: Past and Future
Patrick Legros (Université libre de Bruxelles) and Andrew F. Newman (Boston University)

(19) Discussion of "Contracts, Ownership and Industrial Organization: Past and Future", by Patrick Legros and Andrew Newman
Mathias Dewatripont (Université libre de Bruxelles and National Bank of Belgium)

(20) Discussion of "Contracts, Ownership and Industrial Organization: Past and Future", by Patrick Legros and Andrew Newman
Kai-Uwe Kühn (University of Michigan)

PART 7: Incomplete Contracts and International Trade

(21) Grossman-Hart (1986) Goes Global: Incomplete Contracts, Property Rights, and the International Organization of Production
Pol Antràs (Harvard University)

(22) Comment on Pol Antràs: "Grossman-Hart (1986) Goes Global: Incomplete Contracts, Property Rights, and the International Organization of Production"
Elhanan Helpman (Harvard University)

(23) The Theory of the Firm Goes Global
Dalia Marin (University of Munich)

PART 8: Incomplete Contracts and Public Ownership

(24) Incomplete Contracts and Not for Profit Firms
Paul Grout (University of Bristol)

(25) Firm Ownership: The Legacy of Grossman and Hart
Henry Hansmann (Yale Law School)

(26) Ex-Ante Anonymity and Government Allocation of Property Rights
Rohan Pitchford (Australian National University)

PART 9: Incomplete Contracts and Political Economy

(27) International Treaties as Incomplete Contracts
Bård Harstad (University of Oslo)

(28) Incomplete Contracts and Political Economy
Gerard Roland (University of Berkeley)

(29) Incomplete Contracts and the Design of Constitutions
Guido Tabellini (Bocconi University)

PART 10: Incomplete Contracts, Mechanism Design and Complexity

(30) Comments on the Foundations of Incomplete Contracts
Eric Maskin (Harvard University)

(31) Comments on the Foundations of Incomplete Contracts
John Moore (University of Edinburgh)

(32) Incomplete Contracts and Mechanism Design
Richard Holden (University of New South Wales)

(33) Complexity and Undescribability
Nabil I. Al-Najjar (Nothwestern University), Luca Anderlini (Georgetown University), and Leonardo Felli (London School of Economics)

PART 11: Incomplete Contracts, Reference Points and Communication

(34) New Directions of Incomplete Contracts: Reference Points, Communication, and Renegotiation
Christian Zehnder (University of Lausanne)

(35) Some Recent Experimental Evidence on Contracts as Reference Points
Klaus Schmidt (University of Munich)

(36) Incomplete Contracting in the Field
Antoinette Schoar (Harvard University)

Editorial Reviews

"The contributions in this collection constitute a most worthy celebration of Grossman and Hart's classic paper on incomplete contracting and its deep and wide-ranging impact on economics and beyond."

— Bengt Holmstrom, Paul A. Samuelson Professor of Economics, M.I.T

"The Grossman -Hart incomplete contracts approach represents perhaps the most influential advance in economic theory in the last 30 years. This book assembles many of the remarkable offspring of this truly seminal contribution."

— Andrei Shleifer, Professor of Economics, Harvard University

From the Publisher