Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/23084
Authors: 
Schmidt-Trenz, Hans-Jörg
Schmidtchen, Dieter
Year of Publication: 
2006
Series/Report no.: 
CSLE Discussion Paper 2006-06
Abstract: 
The conventional theory of international trade is dominated by a model presupposing a legal order that is perfect in its specifications and controllability, binding for all economic agents, no matter their nationality. World order appears to be cosmopolitan in the sense of Kant. An international private law community such as this, however, does not exist. In fact, there is a multitude of legal orders and a territoriality of law, leading to problems largely neglected in the traditional theory of international trade. They are at the heart of what we would like to call the New Institutional Economics of International Transactions (NIEIT) – a research program which started from a monograph published in 1990 (see Schmidt-Trenz 1990). This paper addresses two questions: Which specific problems emerge in contracts and the contracting process because of factors such as the multitude of legal orders and the territoriality of law? What solutions are there to these problems a) on the level of the law, and b) in the shadow of the law or completely independent of it (?private ordering?)? How do they work from an efficiency point of view? We restrict attention to the international exchange of goods. However, the insights gained can be transferred to other types of transactions, such as international finance transactions, direct investment, and investment agreements.
Subjects: 
conflict of law
international private law
transaction costs
enforcement of judgements
private ordering
JEL: 
F15
K33
F02
Document Type: 
Working Paper

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