Towards a Socio-Legal Theory of Contractual Risk

Sociologia del Diritto, Vol. 2, p. 83, 2009

10 Pages Posted: 28 Aug 2011

Date Written: October 10, 2009

Abstract

This paper deals with the risk of opportunism – the usual risk in economic exchanges. The breach of contract is probably the most common event in daily life and has therefore attracted research and debates in many disciplines of the social sciences. Our discussion deals with the current knowledge of the ways societies are coping with the risk of opportunism distinguishing between three approaches with ascending degrees of complexity: theories of institutional support of contractual exchanges, theories of relational trust, and theories of social systems of trust. As demonstrated in fig.1 these theories are chosen among many other competing approaches. Legal sociological knowledge rather than being replaced by institutional economics or economic sociology is a necessary and valuable ingredient for theories of contractual risk. Without our knowledge of the protection of property rights in a particular society, of choices made by business people or consumers between formal and informal modes of conflict resolution, of obstacles in court proceedings and of problems when a lawyer is consulted our neighbour disciplines come to either overoptimistic conclusions as regards institutional trust or to oversimplified models as regards personal trust and relationships.

Keywords: opportunism, contracts, contractual risk, trust, relational trust, social systems of trust, legal protection, legal institutions, contractual exchanges, institutional economics, sociology of law

JEL Classification: A14, D21, D23, D74, D81, K12, K20, K41

Suggested Citation

Gessner, Volkmar, Towards a Socio-Legal Theory of Contractual Risk (October 10, 2009). Sociologia del Diritto, Vol. 2, p. 83, 2009. Available at SSRN: https://ssrn.com/abstract=1918255

Volkmar Gessner (Contact Author)

University of Bremen ( email )

PO Box 330440
Bremen, 28334
Germany

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