How does renegotiation affect contracts between a principal and an agent subject to persistent private information and … moral hazard? This paper introduces a concept of renegotiation-proofness, which adapts to stochastic games the concepts of … weak renegotiation-proofness and internal consistency by exploiting natural comparisons across states. When the agent has …

renegotiation. If the buyer expects renegotiation always to take place, the parties are always able to implement the materially … efficient good ex post. It can be optimal for the buyer, however, to expect that renegotiation does not take place. In this case …

We propose a theory of ex post inefficient renegotiation that is based on loss aversion. When two parties write a long …

For the procurement of complex goods the early exchange of information is important to avoid costly renegotiation. If …). Bilateral negotiations are superior if potential design improvements are important, if renegotiation is particularly costly, and …

unobservable and incomplete contracts with and without renegotiation opportunities under the assumption that the principal cannot … outcomes to a subset of Nash equilibrium outcomes and renegotiation imposes further constraints. Yet, there is a large class of …

whether renegotiation occurs and if so, at what cost. When the covenant is not renegotiable or when renegotiation cost is … sufficiently high, more conservative accounting actually reduces the efficiency of debt contracts. When renegotiation cost is small … circumstances, especially for firms with fewer positive NPV projects and higher liquidation values. When renegotiation is costless …

demonstrates that it may well be socially desirable not to enforce contractual terms that explicitly prevent renegotiation, even if … renegotiation can constrain the principal’s abilities to introduce distortions in order to reduce the agent’s rent, so that the …

analyze the equilibrium outcomes of twostage games with renegotiation-proof third-party contracts in relation to the … outcomes of the game without contracts. Introducing renegotiation, in general, imposes further constraints and in some games …