Empirical Relevance of Efficient Contract Theory: Inter-firm Contracts

Bruce R Lyons

Oxford Review of Economic Policy, 1996, vol. 12, issue 4, 27-52

Abstract: Although there has been enormous development of the theory of efficient contracts in the last 20 years, empirical tests were slow to come. However, over the last 10 years, a considerable body of evidence has accumulated, particularly in relation to contracts between firms. This paper develops a simple, integrated theoretical framework to illustrate 11 testable hypotheses. The contract theories covered include risksharing, principal-agent incentive models, transaction cost and incomplete contract models with specific investment, and the theory of relational contracting. The problems associated with empirical work on contracts are discussed before setting the hypotheses against a wide range of econometric and other empirical evidence (including work on franchising, sharecropping, subcontracting, contract duration, private institutions, experimental evidence, and a wide range of case studies). Copyright 1996 by Oxford University Press.

Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (44)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:oxford:v:12:y:1996:i:4:p:27-52

Access Statistics for this article

Oxford Review of Economic Policy is currently edited by Christopher Adam

More articles in Oxford Review of Economic Policy from Oxford University Press and Oxford Review of Economic Policy Limited
Bibliographic data for series maintained by Oxford University Press ().