Important types of contractual relationships-among them those between integrated product manufacturers and their suppliers-are neither fully transactional nor fully relational. The agreements that govern these relationships incorporate highly detailed written terms that focus not only on what is promised but also on the details of how it is to be achieved and how suppliers' actions will be monitored and responded to over the life of the agreement. Together with the implicit relational contracts that support their operation, these provisions create an economic hybrid that lies between markets and hierarchies, a set of relatively standard institutional arrangements that give buyers the right (but not the obligation) to exercise a package of quasi-integration rights that enables them to obtain many of the most important benefits of vertical integration while simultaneously reaping most of the core benefits of outsourcing. The contract provisions used to govern these relationships are termed here "managerial provisions" because they employ the techniques of intra-firm hierarchy that managers use to organize relationships and increase productivity within firms. This article focuses on a subset of these provisions, namely those that are analogous to the eighteen management practices that the World Management Survey (WMS) reveals are closely associated with persistent performance differences across similarly situated enterprises. After documenting the convergence between these practices and the terms of procurement contracts, the article suggests that the contract governance regime these practices create is well designed to support the creation and maintenance of cooperative relationships, strengthen the force of network governance, and scaffold the emergence of the type of inter-firm process-based trust that is associated with better supplier performance. More generally, this article concludes that in the modern economy, where the value of so many types of contracts-from research and development alliances to business process outsourcing agreements and beyond-depends on employees of the contracting entities working together much as if they worked for a single firm, lawyers would be well advised to look to the broad array of managerial techniques successfully used within firms (not only those based on WMS practices) to develop new ways to better govern transactions between firms.

Cooperation within and across organizations is key to organizational and managerial performance. Starting with Granovetter (1985) scholars in management, sociology and economics have shown that social networks can be used as a governance mechanism to facilitate cooperation. These scholars attributed the network effect on cooperation to social networks’ ability to facilitate trust, monitoring and the distribution of reputation-relevant information about past performance. More recent work on cooperation has emphasized two core considerations: First, the importance of shared norms and culture for successful cooperation, and second the underappreciated role formal rules play in scaffolding cooperation and leveraging these forces. These advances together with network scholars’ long-standing insight that network structure can both shape actors’ culture and norms, and be shaped by them, suggest many new avenues for research into network governance of cooperation. To further advance our understanding of network governance, this symposium brings together scholars of networks, contracts, norms, and culture to explore the ways that rules, norms, and culture can support network governed cooperation, and help managers facilitate cooperation within and across organizations. Managerial Contracting: A Preliminary Study Presenter: Lisa Bernstein; U. Of Chicago Presenter: Brad Peterson; Mayer Brown LLP Revisiting Economic Action and Social Structure: Embeddedness in the Age of Amazon Presenter: Hagay Volvovsky; MIT Sloan School of Management Rewiring Social Networks Changes Culture and Language: Evidence from Alt-Right Echo Chambers Presenter: Matthew Yeaton; Columbia Business School It’s Your Turn vs. It’s My Pleasure: Theory and Experiments on the Norm of Reciprocity Presenter: Simon Friis; MIT Sloan School of Management Presenter: Ezra Zuckerman; Massachusetts Institute of Technology

This Article revisits the best known example of successful private ordering in the economics literature: the Maghribi Jewish merchants who engaged in both local and long-distance trade across the Islamic Mediterranean in the eleventh century. Drawing on a case study of over 200 Maghribi merchant letters, it develops a network governance-based account of the way that private ordering might have supported exchange among the Maghribi traders with little or no reliance on the public legal system. The analysis reveals that a particular type of bridge-and-cluster configuration of ties among traders and trading centers--known as a "small-world network"- can have strong reputation-based contract enforcement properties that make it possible support trade over long distances, even in environments of noisy information. This structure economizes on information costs by aggregating information in local nodes and then connecting these nodes with ties that are robust enough to transmit the relevant information but sparse enough to do so at a cost far below the cost of keeping all transactors in the market aware of all reputation-relevant information all of the time. Identifying the governance power of small-world networks reveals that the small, geographically concentrated, close-knit groups (known as cliques) that the legal literature has long associated with successful private ordering are not in fact a precondition for well-functioning private order-small-world networks can effectively support trade among large numbers of traders operating at considerable distances from one another. In addition, because the small world network form can be found in many industries today, recognizing its potential contract governance properties should make it possible to better understand the ways trade both is and can be supported in a variety of modern markets.

This talk reviews and integrates many of my prior studies of trade usages in merchant communities, concluding that the concept is a myth—a myth that has done tremendous damage to commercial laws the world over.

The collected works of Florencia Marotta-Wurgler that are the subject of this symposium have made a major contribution to our understanding of consumer behavior and consumer law. In a series of articles that are meticulously researched, carefully argued, and employ new empirical methodologies, 1 Marotta-Wurgler tests several of the core assumptions that have strongly influenced the predominately theoretical academic debates in consumer law and have played a central role in the ways that courts have analyzed the enforceability of boilerplate in the consumer law context. 2 The empirical studies presented in these articles focus on the terms of the End User License Agreements (EULAs) that accompany the sale of software as well as the consumer behavior surrounding them. Among their many findings, the studies clearly establish: that consumers do not, for the most, part read EULAs; 3 that so few consumers read them that the claim that the choices of an “informed minority” 4 are powerful enough to move the provisions towards efficiency are implausible; 5 that consumers shopping for software rarely access information from third-party ratings sites; 6 and, that the terms of EULAs (with the exception of customer support) are becoming more pro-seller over time. 7 These findings lead Marotta-Wurgler to conclude that neither additional mandatory disclosure nor changes in the ways that consumers are presented with and must indicate their consent to the EULA’s terms are likely to be effective policy-making tools for intervening in software licensing contracts.

The articles in this symposium were part of an interdisciplinary conference on Private Orderings sponsored by the Centre for Corporate Reputation at the University of Oxford, Saı¨d Business School, in September 2014. Through their work, the authors explore the ways that legal and extralegal rules and institutions, networks, reputation, and social capital interact to shape regimes of private ordering. Emily that influence idea century. She introduces casts on account of medieval trade, and provides way medieval business. Kadens demonstrates that merchants did not conduct trade 2

In 2011, the department charged with monitoring compliance with the European Court of Human Rights (ECHR) initiated a new website that functions as a virtual wall of shame: it publishes reports by NonGovernmental Organizations (NGOs) accusing states of noncompliance with ECHR judgments. This paper analyzes all the reports posted in the first four years of the website's existence. It shows that NGOs focus their attention on severe violations and legally significant issues. It also shows that NGOs invest more resources in monitoring high-reputation states than in monitoring low-reputation states. These findings suggest that opening the arena of reputational sanctions to diverse NGOs may help to make states' reputations more accurate and useful. TABLE OF CONTENTS Introduction ............................................................................................. 2 I. The ECHR and its Enforcement Mechanism ....................................... 4 A. The ECHR ..................................................................................... 4 B. The Committee of Ministers .......................................................... 6 C. Rule 9.2 Procedure ......................................................................... 7 II. Are NGOs Focusing on the Trivial or The Important? ....................... 8 A. The Severity of the Violation ....................................................... 10 1. the violated right ...................................................................... 10 2. just satisfaction ......................................................................... 12 B. The Legal Importance of the Case ............................................... 13 1. HUDOC categorization ............................................................ 13 2. the size of the panel .................................................................. 14 3. judicial dialogue ....................................................................... 14 4. other proxies for salience ......................................................... 15 C. Conclusions on the Focus of NGO Attention............................... 16 III. Are High-Reputation States More Vulnerable than Low-Reputation States? ................................................................................................... 16 A. Measuring States' Reputation ....................................................... 17 B. The Connection between State Reputation and NGO Applications .......................................................................................................... 19 C. Alternative Explanations for the Focus of NGOs on HighReputation States .............................................................................. 22 1. willingness to reply to NGO reports ........................................ 22 2. willingness to cooperate with the Committee of Ministers ...... 23 3. willingness to comply with judgments ..................................... 24  Associate Professor of International and Public Law (tenured), University of Copenhagen Faculty of Law affiliated with iCourts. PhD, LLM, LLB, Tel Aviv University Faculty of Law. I thank Karen J. Alter, Patrick Barry, Or Bassok, Eyal Benvenisti, Lisa Bernstein, Avinoam Cohen, Yoav Dothan, Olga Frishman, Rotem Giladi, Tom Ginsburg, Francoise Hampson, Laurence R. Helfer, Saggi Katz, Michal Lavi, Christopher McCrudden, Ioannis Panagis, and Uri Regev for many instructive conversations and comments. I thank participants in the Max Planck Institute for Comparative Public Law and International Law Seminar, the Midwestern Law and Economics Association 2014 Annual Meeting, the University of Chicago Legal Scholarship Workshop, the Northwestern University Legal Scholarship Workshop, the iCourts Research Seminar, the Spanish Law and Economics Association 2015 Annual Meeting, and the German Law and Economics Association 2015 Annual Meeting. This research is funded by the Danish National Research Foundation Grant no. DNRF105 and conducted under the auspices of iCourts, the Danish National Research Foundation’s Centre of Excellence for International Courts. NON-LEGAL SANCTIONS IN INTERNATIONAL LAW 2 Non-Legal Sanctions in International Law [ 4. NGO past involvement ............................................................. 25 5. a concentration of severe and important violations in highreputation states ............................................................................ 26 D. Conclusions about the Focus of NGOs on High-Reputation States .......................................................................................................... 28 IV. The Nature of Reputation ................................................................ 28 A. Imperfect Information Makes Every Deed Count ........................ 29 B. Opening the Shaming Community to Prevent Echo .................... 31 V. What Do NGOs Really Want? ......................................................... 35 A. Separating NGOs According to Size ........................................... 35 B. The Incentives of NGOs .............................................................. 36 VI. Conclusion ...................................................................................... 39

This Article presents an empirical study of the trade usage cases decided under the Uniform Commercial Code from 1970 to 2007. It then draws on the study's findings to revisit the debate over the desirability of the trade usage component of the incorporation strategy-the interpretive approach that directs courts to look to course of dealing, course of performance, and usage of trade to interpret contracts and fill contractual gaps. Although the strategy is generally defended on the grounds that, as compared to a more formalistic adjudicative approach, it will reduce specification costs without unduly increasing interpretive error costs, the study reveals that the empirical assumptions on which this defense is based are highly questionable. More specifically, it shows that usages are not typically demonstrated through the introduction of the types of "objective evidence" that the strategy's defenders suggest will reduce the risk of interpretive error-such as expert witness testimony, industry trade codes, or statistical evidence that a particular practice is widely observed. Rather, usages are most commonly established solely through the testimony of the parties or their employees. Expert testimony is introduced in at most 31.5% of the cases, the introduction of trade codes is rare, and there were no cases in the study in which the regularity with which a practice was observed was demonstrated through statistical evidence rather than the mere assertion of a witness.After presenting the study's findings, the Article reexamines the core justifications for the strategy in light of them. It concludes that because the strategy is likely to increase both specification costs and interpretive error costs, and has particularly negative effects on contracts between large multi-agent firms as well as on the types of outsourcing contracts and contracts for innovation that are increasingly important parts of the modern economy, it should be abandoned in favor of a more formalist approach to contract interpretation, at least in contracts between businesses.

The master agreements that nominally govern the transactions between mid-western OEMs and their suppliers are not, for the most part, designed to create legal obligations. Rather, like the role played by firm boundaries in the Coase-Williamson theory of the firm, they create a space in which private order can flourish. This article explores how sophisticated transactors in this market have combined governance techniques associated with arm's-length contracting, intra-firm hierarchy, and trust-based relational contracting to create relationships that are long-term, highly cooperative, and characterized by significant relationship-specific investment. It suggests that these transactors have been able to accomplish these outcomes with only minimal reliance on the legal system, in large part because they operate in a market of highly interconnected firms-a network that itself functions as a contract governance mechanism. It then explores the implications of these contract structures and the availability of network governance for firms' make-or-buy decisions and the likelihood of innovation.

Customary law has been the subject of intense debate and the issues arising from the intersection of customs and the law are far from settled. This research review brings together seminal work from scholars in law, economics and history. The first section analyses various perspectives on the history of customary law. Part two focuses on the commercial customary law and includes a number of case studies covering the role and limits of customary systems in a variety of commercial settings. The final section explores the role of custom in international law from a variety of legal and economic perspectives.

This short note introduces a special Book Review section of the University of Chicago Law Review that contains two reviews each of which discusses three new books that focus largely on contract doctrine.

In his Article Contracts as Technology Kevin Davis makes an analogy between technological innovation and contractual innovation and suggests that contractual innovation, like technological innovation, can both add value to exchange and promote trade. Davis presents a theory of the uses and sources of contractual innovation that has at its core the idea that “[t]he principal determinant of the value of adopting a contract is the value of the changes in behavior it induces.” The Article then draws on this theory and the analogy to technological innovation to explore the incentives of law firms, businesspeople, trade associations, and a variety of nonprofit institutions to engage in contractual innovation, even though there is no equivalent of copyright, trademark, or patent protection for contractual language. It concludes that given the lack of intellectual property protection for contractual language, potential contractual innovators of all types are likely to make socially sub-optimal investments in contractual innovation.

This essay examines the ability of the recently proposed Common European Sales Law to meet its goal of increasing cross-border trade across the Common Market, in light of its deeply realist jurisprudence and its extensive reliance on the concepts of trade usage and good commercial practice. It concludes that a more formalistic statute that provided menus of clear contract default rules and encouraged a jurisprudential approach similar to that adopted by New York Courts, would have a better chance than the CESL of increasing cross-border trade, especially among small and medium size enterprises.

We wrote this brief essay as an introduction to the volume “Customary Law” (Elgar, 2013). We briefly review several seminal works on customary law. Although scholars in law, economics, and history have provided a wealth of research on the subject, the issues arising from the intersection of customs and the law are far from settled. The discussion is divided into three parts. Part I examines a variety of perspectives on the history of customary law. Part II considers the role and limits of customary systems in a variety of commercial settings. Along the way it focuses on defining the proper relationship between law and custom from a law and economic perspective. Part III explores the role of custom in international law, from a broad set of analytical viewpoints.

Drawing on empirical evidence from the Middle Ages to the present and theoretical arguments developed by neoformalist scholars over the past decade, this chapter explores the uneasy fit between the jurisprudence of the Uniform Commercial Code and its machinery for adjusting to change, and the needs of a modern outsourced economy. It concludes that, given the effects of the Code on multi-agent firms dealing with other multi-agent firms, mere amendments to Article 2 will not suffice to support trade in the modern economy; commercial law must be rethought from the ground up.

Bank documents and on numerous outside sources. The following authors prepared background papers for this Report: István Ábel, Cecile Aubert, Arup Banerji, Erik Berglöf, Lisa Bernstein, Timothy Besley, John P. Bonin, Juan Carlos Botero, Penelope Brook, Wendy Carlin, Nazmul Chaudhury, Klaus Deininger, Simeon Djankov, Cristian PopEleches, David Finnegan, Heywood Fleisig, Tim Hanstad, Bernard Hoekman, Karen Hudes, Timothy Irwin, Roumeen Islam, Sanjay Jain, Hiau Looi Kee, Yoram Keinan, Leora Klapper, Jan Kleinheisterkamp, Jean-Jacques Laffont, Rafael La Porta, Zvi Lerman, Margaret Levenstein, Florencio Lopez-de-Silanes, Keith Maskus, Caralee McLiesh, Claudio Montenegro, Tatiana Nenova, Marcelo Olarreaga, Rowena Olegario, Katharina Pistor, Roy Prosterman, Raghuram G. Rajan, Howard Rosenthal, Brian Schwarzwalder, Paul Seabright, Andrei Shleifer, Warrick Smith, Charles Soludo, Valerie Suslow, Nicola Tynan, Ernst-Ludwig von Thadden, Alexander Volokh, Mark West, and Luigi Zingales. Background papers for the World Development Report are available online at http://www.worldbank.org/ wdr. The views expressed in these papers are not necessarily those of the World Bank or of this Report. Many persons, both inside and outside the World Bank, provided advice and guidance to the team. Valuable comments and contributions were provided by: Alberto Agbonyitor, Sadiq Ahmed, Zafar Ahmed, Emmanuel Akpa, Harold Alderman, Myrna Alexander, Nagavalli Annamalai, Lystra Antoine, Ismail Arslan, Ian Bannon, Kaushik Basu, Abhijit Banerjee, Luca Barbone, Maria Benito-Spinetto, Tim Besley, Deepak Bhattasali, Vinay Bhargava, Dominique Bichara, Milan Bibliographic Note

This Essay adds to the existing literature on expectation damages. It suggests that this literature is implicitly based on the assumption that, in the event of breach, the breached-against party will readily reveal the information necessary to establish the magnitude of expectation damages. It explores the implications of the opposite assumption, namely that an aggrieved party might often prefer to keep the information necessary to establish the magnitude of expectation damages private. More specifically, it suggests that while the traditional literature on remedies has focused on the aggrieved party's interest in being made whole (her compensatory interest), there is another, potentially conflicting interest that needs to be taken into account, namely her desire to keep information private (her interest). When the secrecy interest is sufficiently strong, the cost of revealing the underlying private information may well exceed the aggrieved party's expected recovery at trial. As a consequence, the aggrieved party may not file suit and may therefore receive no compensation. If the existence of a promisee's secrecy interest is known to a promisor who is contemplating breach, the secrecy interest might undermine the credibility of the promisee's threat to sue. Thus, in the presence of a secrecy interest, both the remedial goal of full ex post compensation and the economic goal of efficient breach-or-perform incentives are unlikely to be achieved. The Essay develops the concept of the secrecy interest in more detail and considers how taking it into account might contribute to the debate over the desirability of several of the Code's remedial provisions, the remedial structure of the new proposed Code, and aspects of existing adjudicative procedures. It demonstrates the secrecy violations involved in adjudication under current contract law doctrine. It argues that the Code and the rules of civil procedure should enable aggrieved parties to opt for damage measures and discovery procedures that do not involve information revelation, such as specific performance, liquidated damages and uncapped market difference damages.

The cotton industry has almost entirely opted out of the public legal system, replacing it with one of the oldest and most complex systems of private commercial law. Most contracts for the purchase and sale of domestic cotton, between merchants or between merchants and mills, are neither consummated under the Uniform Commercial Code nor interpreted and enforced in court when disputes arise. Rather, most such contracts are concluded under one of several privately drafted sets of contract default rules and are subject to arbitration in one of several merchant tribunals. Similarly, most international sales of cotton are governed neither by state-supplied legal rules, nor by the Convention on the International Sale of Goods, but rather by the rules of the Liverpool Cotton Association. This Article draws on a detailed case study of contractual relations in the cotton industry to examine the ways that the rules, norms and institutions that constitute the industry's private legal system ("PLS") create value for transactors. It begins by describing the formal operation of the PLS and discussing the ways that its substantive rules, adjudicative approaches and arbitral procedures improve on those provided by the Uniform Commercial Code and the public legal system. It then describes the many steps taken by cotton industry institutions to strengthen the social and informational infrastructures of trade and analyzes how these efforts combine to make reputation-based nonlegal sanctions a powerful force in the industry. The paper then draws on this discussion to suggest that the availability of such sanctions may enable transactors to create value-enhancing contract governance structures that might be either unavailable or prohibitively expensive if their transactions were governed by the public legal system. The paper also discusses in great detail how the industry's efforts to support the legal and extralegal aspects of contracting relationships, together with certain other features of cotton institutions, have succeeded in creating conditions that are conducive to the creation, maintenance and restoration of cooperative contracting relationships. It concludes by suggesting that understanding how the cotton industry's institutions create value for transactors may help identify other industries and other contexts in which private institutions can play a positive role in supporting trade.