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- W3124375024 abstract "In the contract-theoretic literature, there is a vital debate about whether contracts can mitigate the hold-up problem when renegotiation cannot be prevented. Ultimately, the question has to be answered empirically. As a first step in that direction, we have conducted a laboratory experiment with 490 participants. We consider cooperative investments that directly benefit the non-investing party. While according to standard theory, contracting would be useless if renegotiation cannot be ruled out, we find that option contracts significantly improve investment incentives compared to a no-contract treatment. This finding can be explained by Hart and Moore’s (2008) notion that contracts may serve as reference points." @default.
- W3124375024 created "2021-02-01" @default.
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- W3124375024 date "2009-03-01" @default.
- W3124375024 modified "2023-09-27" @default.
- W3124375024 title "Can Contracts Solve the Hold-Up Problem? Experimental Evidence" @default.
- W3124375024 hasPublicationYear "2009" @default.
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