عدم اطلاع ترکیب به نظریه ی قرارداد

Asymmetric awareness of the contracting parties regarding the uncertainty surrounding them is proposed as a reason for incompleteness in contractual forms. An insurance problem is studied between a risk neutral insurer, who has superior awareness regarding the nature of the uncertainty, and a risk averse insuree, who cannot foresee all the relevant contingencies. The insurer can mention in a contract some contingencies that the insuree was originally unaware of. It is shown that there are equilibria where the insurer strategically offers incomplete contracts. Competition among insurers who are symmetrically aware of the uncertainty promotes awareness of the insuree.

In a world where insurance companies spend a lot of resources to compute the facts that are material to the risk, the relevant contingencies lie largely in the knowledge of the insurers. Insurance companies which have been in the industry for a long time may have a better understanding of the realities of nature than an insurance buyer. The buyers trust the insurance companies and proceed upon the confidence that the companies do not hold back any circumstances in their knowledge to mislead the judgment of the buyers. Moreover, policies are usually drafted by insurers, giving them a strong opportunity to manipulate (see Harnett, 1950). This asymmetry between the insurance buyer and seller in foreseeing all the relevant contingencies is the key reason for ex post conflicts. However, the standard contracting models do not allow for agents having asymmetric awareness regarding the nature of the uncertainty. This paper incorporates unawareness in contractual settings in order to understand how insurers use their superiority in terms of understanding the relevant contingencies against buyers. It questions whether such an insurer will mention in the contract those contingencies that the insuree does not foresee originally or he will remain silent on them. Moreover, if the insuree reads a clause about a contingency that did not cross her mind initially, how she evaluates this information is part of the solution concept we propose. Finally, we search for an instrument that leads to disclosure of the unforeseen contingencies.

In this paper, we show that, if unawareness of buyers is an issue, then the insurance companies can use it to their advantage. We argue that, even if complete contracts are feasible, there are situations where only incomplete ones can emerge for strategic reasons. Conflicts between contracting parties due to ex post recognition of the incompleteness of contracts are difficult challenges for the courts. It is hard to prove ex post that some party left the contract incomplete intentionally. We offer competition as an instrument that does not require such a super power to achieve complete contracts. Competition among insurers with superior awareness can achieve complete contracts in equilibrium. Moreover, if there exists an unforeseen and relatively costly damage, the awareness of buyers is always extended in any equilibrium with competition. Our model is a starting point which relaxes a strong assumption in contract theory. It is a realistic exercise to allow for agents who take into account different aspects of an economic situation. The tools developed here can be used for models where the insuree has superior awareness. Additionally, modeling more complicated contractual situations where moral hazard or adverse selection is also an issue would be an insightful research question.