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Contract, Freedom of

Encyclopedia of Law and Economics

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Definition

Freedom of contract is a principle of law, expressing three related ideas: Parties should be free to choose their contracting partners (“party freedom”), to agree freely on the terms of their agreement (“term freedom”), and where agreements have been freely made, parties should be held to their bargains (“sanctity of contract”). A key contribution of economics to contract law scholarship has been to systematize and rationalize both the principle and its limits in terms of social welfare. This entry provides an overview of the economic justifications and limitations of the principle.

Freedom of Contract: Meaning and Significance

Freedom of contract is a fundamental principle of most modern contract law regimes, expressing three related ideas: Parties should be free to choose their contracting partners (“party or partner freedom”), to agree freely on the terms of their agreement (“term freedom”), and “where agreements have been freely made, the parties should be held to their...

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Authors and Affiliations

  1. School of Law, University of Aberdeen, Aberdeen, UK

    Péter Cserne

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  1. Péter Cserne
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Correspondence to Péter Cserne .

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Editors and Affiliations

  1. Montpellier, France

    Alain Marciano

  2. Dept DiGSPES, Univ del Piemonte Orientale Dept DiGSPES, Alessandria, Italy

    Giovanni Battista Ramello

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Cserne, P. (2021). Contract, Freedom of. In: Marciano, A., Ramello, G.B. (eds) Encyclopedia of Law and Economics. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-7883-6_538-2

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  • DOI: https://doi.org/10.1007/978-1-4614-7883-6_538-2

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  • Print ISBN: 978-1-4614-7883-6

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Chapter history

  1. Latest

    Contract, Freedom of
    Published:
    08 May 2021

    DOI: https://doi.org/10.1007/978-1-4614-7883-6_538-2

  2. Original

    Contract, Freedom of
    Published:
    30 December 2014

    DOI: https://doi.org/10.1007/978-1-4614-7883-6_538-1

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