The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Incomplete Contracts

  • Oliver Hart
Reference work entry


The past decade has witnessed a growing interest in contract theories of various kinds. This development is partly a reaction to our rather thorough understanding of the standard theory of perfect competition under complete markets, but more importantly to the resulting realization that this paradigm is insufficient to accommodate a number of important economic phenomena. Studying in more detail the process of contracting – particularly its hazards and imperfections – is a natural way to enrich and amend the idealized competitive model in an attempt to fit the evidence better.

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Oliver Hart
    • 1
  1. 1.