The missing piece is the environment and mechanisms for amending the contract. Having a set of norms, a body of law, and a court mechanism that is specifically empowered to decide what happens in situations not specified very clearly in the contract, is what keeps the cost of contracts manageable, and the ability to enter into contracts without trust in the goodwill of the counterparty.
If you know the courts won’t enforce some clauses, and will punish “bad faith” even if it’s technically within the terms, you don’t have to be as careful and complete in writing the contract. Arguably, Godel showed that you cannot be both consistent and complete in your description of rules of behavior, so you MUST have some mechanism to handle the out-of-distribution events. And to mitigate the capability-assymetry in analyzing a contract. Without such extra-contractual enforcement, it can be safely assumed that most contracts are predatory, and based on one party misunderstanding the likelihood or effects of some contingency.
I think this is just a long-winded way to say “agreed.”
The missing piece is the environment and mechanisms for amending the contract. Having a set of norms, a body of law, and a court mechanism that is specifically empowered to decide what happens in situations not specified very clearly in the contract, is what keeps the cost of contracts manageable, and the ability to enter into contracts without trust in the goodwill of the counterparty.
If you know the courts won’t enforce some clauses, and will punish “bad faith” even if it’s technically within the terms, you don’t have to be as careful and complete in writing the contract. Arguably, Godel showed that you cannot be both consistent and complete in your description of rules of behavior, so you MUST have some mechanism to handle the out-of-distribution events. And to mitigate the capability-assymetry in analyzing a contract. Without such extra-contractual enforcement, it can be safely assumed that most contracts are predatory, and based on one party misunderstanding the likelihood or effects of some contingency.
I think this is just a long-winded way to say “agreed.”