On the Determinants and Consequences of Informal Contracting

58 Pages Posted: 6 Feb 2015 Last revised: 10 Feb 2015

See all articles by Ricard Gil

Ricard Gil

Queen's University (Canada) - Smith School of Business; Johns Hopkins University - Carey Business School

Giorgio Zanarone

CUNEF

Multiple version iconThere are 2 versions of this paper

Date Written: February 4, 2015

Abstract

As documented by Macauley (1963) and others, informal contracts are pervasive in modern economies. Yet, systematic empirical evidence on them is still limited. In this paper, we provide a framework to investigate the determinants and consequences of informal contracts. First, we present a model that organizes key predictions from the theoretical literature. Next, we discuss selected empirical works that shed light on the model’s empirical relevance. Finally, we discuss strategies for testing theoretical predictions for which conclusive evidence is still missing, as well as unexplored research opportunities offered by available studies and data.

Keywords: Contracts, Enforcement, Empirical evidence, Testability

JEL Classification: D23, L24, M21

Suggested Citation

Gil, Ricard and Zanarone, Giorgio, On the Determinants and Consequences of Informal Contracting (February 4, 2015). Available at SSRN: https://ssrn.com/abstract=2560520 or http://dx.doi.org/10.2139/ssrn.2560520

Ricard Gil (Contact Author)

Queen's University (Canada) - Smith School of Business ( email )

Smith School of Business - Queen's University
143 Union Street
Kingston, Ontario K7L 3N6
Canada

Johns Hopkins University - Carey Business School ( email )

100 International Drive
Baltimore, MD 21202
United States

HOME PAGE: http://carey.jhu.edu

Giorgio Zanarone

CUNEF ( email )

Leonardo Prieto Castro 2
Madrid, Madrid 28040
Spain

HOME PAGE: http://gzanarone.cunef.edu

Register to save articles to
your library

Register

Paper statistics

Downloads
143
rank
198,783
Abstract Views
544
PlumX Metrics