Hypothesis that if a contract continues to exist it must be efficient due to survivorship bias
This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these template messages)
This article may be too technical for most readers to understand. Please help improve it to make it understandable to non-experts, without removing the technical details.(January 2016) (Learn how and when to remove this message)
The topic of this article may not meet Wikipedia's general notability guideline. Please help to demonstrate the notability of the topic by citing reliable secondary sources that are independent of the topic and provide significant coverage of it beyond a mere trivial mention. If notability cannot be shown, the article is likely to be merged, redirected, or deleted. Find sources: "Efficient contract theory" – news · newspapers · books · scholar · JSTOR(February 2019) (Learn how and when to remove this message)
(Learn how and when to remove this message)
Efficient contract theory suggests that in a strong-form efficient market, if a contract exists, then it must be efficient due to survivorship bias.
For example, the initial public offering market in the United States has an underwriting spread of approximately 7% in the majority of cases despite some offerings being of differing size or difficulty. Some argue that this cannot reflect the true costs to the investment bank, as it does not account for economies of scale that the bank would no doubt benefit from for larger deals. Efficient contract theory would suggest that given the investment banking market is competitive and there is freedom of entry and exit, 7% must be an efficient contract otherwise it would not exist.[1]
While the phrase "efficient contract" is in widespread use as a non-defined term, the defined-term as described above has only been used by Bruce Lyons in a paper from 1996.
^Bruce R Lyons "Empirical Relevance of Efficient Contract Theory: Inter-firm Contracts" Oxford Review of Economic Policy, 1996, vol. 12, issue 4, 27-52
and 24 Related for: Efficient contract theory information
Efficientcontracttheory suggests that in a strong-form efficient market, if a contract exists, then it must be efficient due to survivorship bias. For...
In legal theory, particularly in law and economics, efficient breach is a voluntary breach of contract and payment of damages by a party who concludes...
without making the other person less satisfied. The contract curve is the subset of the Pareto efficient points that could be reached by trading from the...
below the expected return Efficientcontracttheory – Hypothesis that if a contract continues to exist it must be efficient due to survivorship bias Escalation...
t\}}]\right)^{\frac {1}{2}}} . Efficientcontracttheory – Hypothesis that if a contract continues to exist it must be efficient due to survivorship bias Financial...
below the expected return Efficientcontracttheory – Hypothesis that if a contract continues to exist it must be efficient due to survivorship bias Hiding...
In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting...
It can be summarized as the process of systematically and efficiently managing contract creation, execution, and analysis for the purpose of maximizing...
least as well-off as they were before). A situation is called Pareto efficient or Pareto optimal if all possible Pareto improvements have already been...
(an efficient amount of shares of every individual position within the fund or account can be purchased), the portfolio manager can close the contract and...
Contract bridge, or simply bridge, is a trick-taking card game using a standard 52-card deck. In its basic format, it is played by four players in two...
dividends). Aladdin (BlackRock) Economic Cycle Research Institute Efficientcontracttheory Social return on investment Financial forecast Stock market prediction...
option contracts play an important role in the field of contracttheory. In particular, Oliver Hart (1995, p. 90) has shown that option contracts can mitigate...
tax. Alternatively, it may be efficient to forbid renegotiation. Yet, there are situations in which a ban on contract renegotiation is not desirable...
for the respective theories of the firm? Firms exist as an alternative system to the market-price mechanism when it is more efficient to produce in a non-market...
contract theory. Additionally, certain academic conceptions of contracts focus on questions of transaction cost and 'efficient breach' theory. Another...
expectation of a contract. The reliance theory should be seen as a supplement to the will theory, affording an alternative basis for contract in circumstances...
In game theory, a cooperative game (or coalitional game) is a game with groups of players who form binding “coalitions” with external enforcement of cooperative...
to enable efficient trading where none had previously existed. This is studied in the field of collective action and public choice theory. "Optimal welfare"...
without making the other person less satisfied. The contract curve is the subset of the Pareto efficient points that could be reached by trading from the...
Journal 271 I Macneil, ‘Efficient Breach of Contract: Circles in the Sky’ (1982) 68 Virginia LR 947 Guide to specific performance in property contracts...
companies should hire contract management teams. This way they would not just be hiring an experienced employee but an entire team of efficient and experienced...
languages are languages constructed to efficiently solve problems of a particular part of domain. Compiler theory is the theory of writing compilers (or more generally...
Global Information
