August 26, 2008
The Legality of "Rolling Contracts"
The rise of commerce over the Internet and telephone has led to widespread use of "pay now, terms later" or "rolling" standard form contracts, in which buyers are not able to read the standard terms until after they have purchased the product. While some scholars and judges argue that rolling contracts do not merit special attention, others, including consumer advocates, are concerned that sellers take advantage of delayed disclosure by hiding especially unfavorable terms. I find no evidence for this view. In a large sample of software license agreements, I find that software publishers that use rolling contracts for their online sales offer do not offer more one-sided terms than those who make their licenses available prior to purchase. The results suggest that to the extent there are inefficiencies associated with standard form contracts, they are not made worse by delayed disclosure.
August 26, 2008 | Permalink
TrackBack URL for this entry:
Listed below are links to weblogs that reference The Legality of "Rolling Contracts":
Tracked on Sep 17, 2009 1:44:09 AM