not only the main tool to facilitate and regulate economic transactions and to allow for division of labour,3 but also a means for individuals to pursue their own perception of the good. At the same time, however, it is exactly this emphasis on private autonomy that becomes the Achilles’ heel of many contracts. As long as an agreement is the result of free bargaining among socially and economically equal parties, each party is likely to benefit from the contract. But reality may be different: consumer-buyers, insurees, tenants, employees and smaller businesses often simply have to accept the terms dictated to them by their economically stronger and more experienced counterparts. This explains why the two simultaneously beating hearts of contract law are the one that allows allocating resources through exchange and the one that is concerned with realising a minimum amount of fairness among the contracting parties to avoid abuse of bargaining power.
A great variety of contract types exist. Although laypeople often associate contracts only with a piece of paper through which they buy a house or take up a job the law uses a much broader definition. In any given jurisdiction contracts are defined as legally binding agreements, irrespective of whether they are written down or not. This means that, in law, people conclude binding contracts when they buy products in a supermarket, take out insurance, download software, see their doctor, go to the hairdresser or open up a franchise. Contracts can also come about in...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.