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The Taylor contract came as a response to results of new classical macroeconomics, in particular the policy-ineffectiveness proposition proposed in 1975 by Thomas J. Sargent and Neil Wallace [3] based upon the theory of rational expectations, which posits that monetary policy cannot systematically manage the levels of output and employment in the economy and that monetary shocks can only give ...
Contract theory in economics began with 1991 Nobel Laureate Ronald H. Coase's 1937 article "The Nature of the Firm". Coase notes that "the longer the duration of a contract regarding the supply of goods or services due to the difficulty of forecasting, then the less likely and less appropriate it is for the buyer to specify what the other party should do."
Also called resource cost advantage. The ability of a party (whether an individual, firm, or country) to produce a greater quantity of a good, product, or service than competitors using the same amount of resources. absorption The total demand for all final marketed goods and services by all economic agents resident in an economy, regardless of the origin of the goods and services themselves ...
[12] [13] Taken together, whether or not suitable contracts can solve the hold-up problem is disputed in contract theory. [14] In an experimental study, Hoppe and Schmitz (2011) found that option contracts may alleviate the hold-up problem even when renegotiation is possible, which may be explained by Hart and Moore's (2008) idea that contracts ...
In economics, implicit contracts refer to voluntary and self-enforcing long term agreements made between two parties regarding the future exchange of goods or services. Implicit contracts theory was first developed to explain why there are quantity adjustments ( layoffs ) instead of price adjustments (falling wages) in the labor market during ...
The theory of the firm consists of a number of economic theories that explain and predict the nature of the firm, company, or corporation, including its existence, behaviour, structure, and relationship to the market. [1] Firms are key drivers in economics, providing goods and services in return for monetary payments and rewards.
THE WOODLANDS, Texas, March 04, 2025 (GLOBE NEWSWIRE) -- Gulf Island Fabrication, Inc. (NASDAQ: GIFI) (“Gulf Island” or the “Company”), a leading steel fabricator and service provider to the industrial and energy sectors, today announced its results for the fourth quarter and full year 2024.
In economic theory, the field of contract theory can be subdivided in the theory of complete contracts and the theory of incomplete contracts.In contract law, an incomplete contract is one that is defective or uncertain in a material respect.