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Essay Details:
Essay text:
Our main finding is that contracts that are
linked to an asset-specific investment are on average 7 years longer than the others; however, their
duration decreases with liberalization as well.
Keywords: long-term contracts, asset-specificity, natural gas
JEL-Codes: L22, L95, Q41
2
1 Introduction
Long term contracts are back on the research and policy agenda. The issue of long-term contracts as an
intermediate organizational form somewhere in between vertical integration and short-term, marketbased
trading in itself is a regular topic in institutional economics and contract theory. Yet empirical
work on the determinants of long-term contracts evolved mainly in the 1980s (e...
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