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Contract Law, Social Norms and Inter-firm Cooperation


  • Arrighetti, Alessandro
  • Bachmann, Reinhard
  • Deakin, Simon


This paper analyzes the regulation of interfirm contracting in Germany, Britian, and Italy. Contrary to earlier empirical studies and to models drawn from transaction-cost theory, the authors find that contract law may play an important role in underpinning long-term, cooperative relationships and in fostering trust. The impact of contract law depends on the relationship between the legal system and other forms of institutional regulation, including trade associations and standard-setting bodies. Copyright 1997 by Oxford University Press.

Suggested Citation

  • Arrighetti, Alessandro & Bachmann, Reinhard & Deakin, Simon, 1997. "Contract Law, Social Norms and Inter-firm Cooperation," Cambridge Journal of Economics, Oxford University Press, vol. 21(2), pages 171-195, March.
  • Handle: RePEc:oup:cambje:v:21:y:1997:i:2:p:171-95

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    Cited by:

    1. Meuleman, Miguel & Jääskeläinen, Mikko & Maula, Markku V.J. & Wright, Mike, 2017. "Venturing into the unknown with strangers: Substitutes of relational embeddedness in cross-border partner selection in venture capital syndicates," Journal of Business Venturing, Elsevier, vol. 32(2), pages 131-144.
    2. T Quince, 2001. "Entrepreneurial Collaboration: Terms of Endearment or Rules of Engagement?," Working Papers wp207, Centre for Business Research, University of Cambridge.
    3. Martino, Gaetano, 2010. "Trust, contracting, and adaptation in agri-food hybrid structure," MPRA Paper 37617, University Library of Munich, Germany.
    4. Mike Danson & Geoff Whittam, 1998. "Clustering, innovations and trust: the essentials of a clusters strategy for Scotland," ERSA conference papers ersa98p387, European Regional Science Association.
    5. Simon Deakin, 2013. "The Legal Framework Governing Business Firms & its Implications for Manufacturing Scale & Performance: The UK Experience in International Perspective," Working Papers wp449, Centre for Business Research, University of Cambridge.
    6. repec:wfo:wstudy:19531 is not listed on IDEAS
    7. Ding Chen & Simon Deakin & Mathias Siems & Boya Wang, 2016. "Law, Trust & Institutional Change in China: Evidence from Qualitative Fieldwork," Working Papers wp485, Centre for Business Research, University of Cambridge.
    8. Hendley, Kathryn & Murrell, Peter, 2003. "Which mechanisms support the fulfillment of sales agreements?: Asking decision-makers in firms," Economics Letters, Elsevier, vol. 78(1), pages 49-54, January.
    9. Kossykh Yulia & Sarychev Andrey, 2000. "Tales of Contract Enforcement in Transition," EERC Working Paper Series 98-267e, EERC Research Network, Russia and CIS.
    10. repec:dgr:rugsom:03g06 is not listed on IDEAS
    11. Chen Ding & Deakin Simon, 2015. "On Heaven’s Lathe: State, Rule of Law, and Economic Development," The Law and Development Review, De Gruyter, vol. 8(1), pages 123-145, June.
    12. Simon Johnson & John McMillan, 2002. "Courts and Relational Contracts," Journal of Law, Economics, and Organization, Oxford University Press, vol. 18(1), pages 221-277, April.
    13. Brodrechtova, Yvonne, 2015. "Economic valuation of long-term timber contracts: Empirical evidence from Germany," Forest Policy and Economics, Elsevier, vol. 55(C), pages 1-9.
    14. Andrikopoulos, Andreas A. & Prodromidis, Kyprianos P., 2001. "The qualitative element in organization behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 30(4), pages 353-362.
    15. Ding Chen & Simon Deakin, 2014. "On Heaven's Lathe: State, Rule of Law, & Economic Development," Working Papers wp464, Centre for Business Research, University of Cambridge.
    16. Julien Vercueil, 1998. "Qu'apporte la théorie évolutionniste à la compréhension de la transition en Russie ? Une application : temps incertitude et institutions," Working Papers halshs-01418945, HAL.
    17. Deakin, S., 2011. "Legal Evolution: Integrating Economic and Systemic Approaches," Working Papers wp424, Centre for Business Research, University of Cambridge.
    18. Bachmann, Reinhard, 2001. "The role of trust and power in the institutional regulation of territorial business systems," Research Report 01G30, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    19. Avdasheva Svetlana & Rozanova Nadezhda, 1999. "Analysis of Structural Development of Petroleum and Sugar Markets in the Russian Economy," EERC Working Paper Series 99-01e, EERC Research Network, Russia and CIS.
    20. Christopher Cramer, 2000. "Privatisation and Adjustment in Mozambique: a 'Hospital Pass'?," Working Papers 111, Department of Economics, SOAS, University of London, UK.
    21. Ees, Hans van & Bachmann, Reinhard, 2003. "Transition economics and trust building : a network perspective on E.U. enlargement," Research Report 03G06, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    22. Hemmert, Martin & Kim, DaeSoo & Kim, Jisun & Cho, BooYun, 2016. "Building the supplier's trust: Role of institutional forces and buyer firm practices," International Journal of Production Economics, Elsevier, vol. 180(C), pages 25-37.

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