Relational Contract Theory and Sovereign Debt

Palzer, Keith A. | January 1, 1988

Relational contract theory will first be presented using principles gleaned from writings in the field 7 to craft a functional/relational model with which to approach legal practice.8 This version of relational contract will then be applied to the problem of developing country debt through description of a hypothetical sovereign loan relationship.9 By exploring the conflicts and trends of this association under a general “taxonomy of relational contract,” normative analysis of the restructuring process can be accomplished, contractual trends identified, and suggestions for change offered.’