“Code is law” refers to the idea that, with the advent of digital technology, code has progressively established itself as the predominant way to regulate the behavior of Internet users. Yet, while computer code can enforce rules more efficiently than legal code, it also comes with a series of limitations, mostly because it is difficult to transpose the ambiguity and flexibility of legal rules ...

Decentralised smart contracts represent the next step in the development of protocols that support the interaction of independent players without the presence of a coercing authority. Based on protocols à la BitCoin for digital currencies, smart contracts are believed to be a potentially enabling technology for a wealth of future applications. The validation of such an early developing technolo...

We explore possibility of manual and automated contract extraction from Java classes and Enterprise Java Beans. Contracts are extended component interfaces that are defined using Contract Definition Language. They describe functional and non-functional properties. We examine how to extract hidden contracts and express them formally,modeling software components as abstract machines, hoping to ac...

In this study we investigate key contingencies that determine the active use of a formal contract after the strategic alliance has started. The antecedents for this ex post contract use address the contracting process, the need to safeguard spill-over risks and the existence of trust. The model is tested with unique and comprehensive data that were collected directly from a field study of 391 D...

In this paper we introduce a novel approach to formal specification of pipelined designs. The approach is based on contract specifications of pipe stages extended by a mechanism of temporal binding. Contract specifications describe the pipeline behavior in the form of preconditions and postconditions of pipe stages, while temporal binding combines specifications of separated stages into a co-op...

Motivated by the popularity of Value-at-Risk (VaR) objective in finance, this chapter reviews and studies its application in fashion retail operations management. First, a formal optimization model is reviewed in which the fashion retailer aims at optimizing a VaR objective with both pricing and inventory decisions. Second, the detailed solution schemes are explored. Third, numerical examples a...

Blockchain-based smart contracts are considered a promising technology for handling financial agreements securely. In order to realize this vision, we need a formal language to unambiguously describe contract clauses. We introduce Findel – a purely declarative financial domain-specific language (DSL) well suited for implementation in blockchain networks. We implement an Ethereum smart contract ...

Researchers as well as policymakers have expressed concerns that some contract features in the credit-card and subprime mortgage markets may induce consumers to borrow too much and to make suboptimal contract and repayment choices. These concerns are motivated in part by intuition and evidence on savings and credit suggesting that consumers have a time-inconsistent taste for immediate gratifica...

Considered as a social contract, a financial safety net imposes duties and confers rights on different sectors of the economy. Within a nation, elements of incompleteness inherent in this contract generate principal-agent conflicts that are mitigated by formal agreements, norms, laws, and the principle of democratic accountability. Across nations, additional gaps emerge that are hard to bridge....

Economic performance depends crucially on how parties adapt to changing circumstances. We therefore study how the organization of economic activity can facilitate such adaptation. Where spot transactions would produce inefficient adaptation, we ask how governance structures (allocations of control) can facilitate relational contracts that improve on spot adaptation. We show that the optimal gov...