Renegotiation is not Inimical to Friendship

In 2016, Profs. Oliver Hart and Bengt Holmstrom won the Nobel Prize in Economics for theoretical models, whose predictions have received validation in experiences of economic agents in all spheres of economic activity.

In their theoretical models, Profs. Hart and Holmstrom predicted that attempts at arrival at ‘perfect contracts’ are, for lack of better terminology, a waste of time.