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72 Nw. U. L. Rev. 854 (1977-1978)
Contracts: Adjustment of Long-Term Economic Relations under Classical, Neoclassical, and Relational Contract Law

handle is hein.journals/illlr72 and id is 870 raw text is: Copyright 1978 by Ian R. Macneil Printed in U.S.A. Vol. 72, No. 6 CONTRACTS: ADJUSTMENT OF LONG-TERM ECONOMIC RELATIONS UNDER CLASSICAL, NEOCLASSICAL, AND RELATIONAL CON- TRACT LAW Ian R. Macneil* I. INTRODUCTION ....................................................... 854 II. DISCRETE TRANSACTIONS: CLASSICAL CONTRACr LAW ........ 856 A. The Nature of Discrete Transactions ...................... 856 B. Adjustment and Termination of Economic Relations in a System of Discrete Transactions ...................... 859 C. Classical Contract Law and Discrete Transactions ...... 862 ]I. VARIATIONS FROM THE DISCRETE TRANSACTION: NEOCLASSICAL CONTRAT LAW ................................... 865 A. Planning Flexibility into Long-Term Contractual Relations and the Neoclassical Response ................. 865 B. Conflict between Specific Planning and Needs for Flexibility: The Neoclassical Response ................... 873 C. Planning for Nondisruptive Dispute Settlement: The Neoclassical System and Prevention of D isruption .................................................. 876 D. Terminating Economic Activities and Allocating Losses from Termination .................................... 880 E. Overview of the Limits of a Neoclassical Contract Law System .................................................... 883 IV. CONTRACTUAL RELATIONS: RELATIONAL CONTRACT LAW .... 886 A. Presentiation and Discreteness in Contractual Relations ....................................... 887 B. Processes for Flexibility and Change in Contractual Relations ....................................... 889 C. The Substance of Change in Contractual Rela- tions ............................................................ 895 D. Termination of Contractual Relations ..................... 899 V . SUMMARY ............................................................ 900 APPENDIX: TRANSACTIONAL AND RELATIONAL AXEs .................. 902 INTRODUCTION This article concerns the constant clash in modern economic struc- tures between the need for stability and the need to respond to change. I * Ingersoll Professor of Law, Cornell Law School; B.A., University of Vermont, 1950; J.D., Harvard University, 1955. I This paper has grown out of prior published work and of working papers prepared for a number of conferences and seminars: Conference of Polish and American Jurists, Lancut,