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Williamson (1983) - Credible Commitments Using Hostages To Support Exchange (view source)
Revision as of 17:37, 26 June 2011
, 17:37, 26 June 2011→Summary
==Summary==
This paper is concerned with using hostages to prevent opportunistic behaviour in incomplete contracts with relational-specific investments. However, I do not believe that the arguements arguments are valid. Specifically if it is subgame perfect to "execute the hostages" (or to return them), then you do. End of story. In Williamson's defense, the paper may pre-date the notion of sub-game perfection.
I, therefore, do not summarize this paper here. Sorry Ollie.