For over a decade, contracts literature has focused on standardization. Scholars asked how terms become standard, and why they change so rarely. This line of inquiry painted a world where a standard term persists until it is dislodged by another standard term, perhaps after a brief window of...

This essay highlights a phenomenon that has no place in the conventional theory of sophisticated business contracts: the term that makes no sense as an enforceable promise, one that defies functional explanation, one that drafters blush to rationalize in retrospect or chalk up to honest mistake....

The traditional view of sovereign debt as a relationship between a developing country government and and its foreign private creditors is increasingly out of date. Financial institutions and individuals inside the borrowing countries are are becoming more and more important as creditors to their...

Argentina recently completed the largest sovereign bond restructuring in history. As soon as the government announced the results of its $100 billion tender in March 2005, editorial pages worldwide heralded a new era for sovereign debt, for the emerging markets and, occasionally, for...

Until recently, governments borrowed from domestic residents and foreign investors using very different instruments. Residents bought quot;domestic debtquot; - paper denominated in local currency and governed by domestic law. Foreign investors preferred quot;external debtquot;, which offered...

This essay considers standard-form over-the-counter (OTC) derivatives contracts from an organizational perspective. OTC derivatives contracts are highly standardized and have a peculiar modular structure. Most are drafted by a single trade group, which is not party to the contracts. These...

Modification-proof contracts boost commitment and can help overcome information problems. But when such rigid contracts are ubiquitous, they can function as social suicide pacts, compelling enforcement despite significant externalities. At the heart of the current financial crisis is a contract...

Not long ago, financial markets in most poor and middle-income countries were shallow to nonexistent, and closed to foreigners. Governments often had to rely on risky borrowing abroad; the private sector had even fewer options. But between 1995 and 2005, domestic debt in the emerging markets grew...

The escalating crisis in Ukraine has prompted the United States and Europe to impose the toughest economic sanctions against Russia since the end of the Cold War. Continued instability and military conflict in eastern Ukraine are straining Ukrainian finances. Despite a generous international...