演講者簡介 : Professor Cheng received his Ph.D. in Economics from Toulouse School of Economics at 2015. He is currently an Assistant Professor at National Central University. His research fields are Applied Microeconomic Theory, Industrial Organization, Law and Economics, and Behavioral Economics.
演講摘要 : This paper aims to provide a simple model to study the relationship between legal environment and contractual choice, in particular contracts with different timing of payment. Legal environment is defined by the fixed cost of using the legal system and quality of the court performance. Consider any given trading between a buyer and a seller, in case of dispute, the conflict can be resolved by court. Obviously, the contractual terms will be influenced by the expected outcome of the potential litigation. And indeed in reality a large majority of cases ended in the pre-trial settlement, which is also modeled in this paper. The timing of payment can be generally grouped as payment before or after provision of goods and service. It should be the most commonly used device to avoid one-sided opportunistic behavior, either the seller provides subpar quality of good or the buyer defaults on payment. This paper will consider, under the two-sided moral hazard setting, with a given legal environment how a particular type of contract supersedes the other.
