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Language and Contract


  • Oren Sussman


A civic society is distinguished by its language and its law. In this paper I suggest a theory that links these institutions via the notion of a standard contract. The theory is based upon two observations: that contracts are compiled in words, and that more common (standardized) words are easier to comprehend than less common ones. I will argue that these observations have far-reaching implications: that private contracting is restricted by past history, and that the State should play a role in the formation of contractual and legal standards.

Suggested Citation

  • Oren Sussman, 1998. "Language and Contract," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 154(2), pages 384-384, June.
  • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(199806)154:2_384:lac_2.0.tx_2-a

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    References listed on IDEAS

    1. Winand Emons, 1997. "Credence Goods and Fraudelent Experts," RAND Journal of Economics, The RAND Corporation, vol. 28(1), pages 107-119, Spring.
    2. Al-Najjar, Nabil Ibraheem, 1995. "Decomposition and Characterization of Risk with a Continuum of Random Variables," Econometrica, Econometric Society, vol. 63(5), pages 1195-1224, September.
    3. Bar-Isaac, Heski, 2005. "Imperfect competition and reputational commitment," Economics Letters, Elsevier, vol. 89(2), pages 167-173, November.
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    Cited by:

    1. Sussman, Oren, 1999. "Economic growth with standardized contracts," European Economic Review, Elsevier, vol. 43(9), pages 1797-1818, October.

    More about this item

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • N20 - Economic History - - Financial Markets and Institutions - - - General, International, or Comparative
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General


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