preponderance-of-the-evidence to determine whether the agent acted in accordance with the contract. In the second method, the court … adopts a substantive approach, treating the original contract as incomplete, thus rendering a decision based on what it … believes the parties would have agreed upon had they been able to complete the contract ahead of time. From an efficiency …

multiplicative separability condition, the optimal mechanism offers a single contract. This condition holds, for example, when output … likelihood ratio property, the mechanism offers a single debt contract. Our results generalize if the output distribution is … “close” to multiplicatively separable. Our model suggests that offering a single contract may be optimal in environments with …