Non-Contractual Relations in Business: A Preliminary Study

This chapter draws on sociological ideas and empirical investigation of law teachers. It argues that among other things, the functions and dysfunctions of using contract to solve exchange problems and the influence of occupational roles on how one assesses whether the benefits of using contract outweigh the costs. Reciprocity, exchange or contract has long been of interest to sociologists, economists and lawyers. Furthermore, the report will be limited to a presentation of the findings concerning when contract is and is not used and to a tentative explanation of the findings. The use and nonuse of contract in creating exchange relations and in dispute settling will be taken up in turn. The power to decide that a more contractual method of creating relationships and settling disputes shall be used will be held by different people at different times in different organizations.