IDEAS home Printed from https://ideas.repec.org/a/cje/issued/v20y1987i4p750-73.html
   My bibliography  Save this article

Lost Profits, Market Damages, and Specific Performance: An Economic Analysis of Buyer's Breach

Author

Listed:
  • Asha Sadanand

Abstract

Suppose a buyer enters into a contract with a seller and subsequently wishes not to perform. This paper examines a formal model of three standard remedies-lost profits, market damages, and specific performance-to assess how well each compensates the seller. By defin ition, specific performance compensates exactly, since effectively th e buyer must perform. The extent to which the other remedies compensa te accurately depends upon the ease with which the buyer could otherw ise resell the unwanted goods. The lost-profits remedy compensates we ll when the buyer is unable to resell and otherwise overcompensates; the opposite holds for the market-damages remedy.

Suggested Citation

  • Asha Sadanand, 1987. "Lost Profits, Market Damages, and Specific Performance: An Economic Analysis of Buyer's Breach," Canadian Journal of Economics, Canadian Economics Association, vol. 20(4), pages 750-773, November.
    • Handle: RePEc:cje:issued:v:20:y:1987:i:4:p:750-73
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0008-4085%28198711%2920%3A4%3C750%3ALPMDAS%3E2.0.CO%3B2-R
    Download Restriction: only available to JSTOR subscribers
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cje:issued:v:20:y:1987:i:4:p:750-73. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Prof. Werner Antweiler (email available below). General contact details of provider: https://edirc.repec.org/data/ceaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.