The Right to Withdraw in Contract Law

Authors

Eric A. PosnerFollow
Omri Ben-ShaharFollow

Publication Date

2010

Publication Title

Law & Economics Working Papers

Abstract

European law gives consumers the right to withdraw from a range of contracts for goods and services; American law, with narrow exceptions, does not. Yet merchants in the United States frequently provide by contract that consumers have the right to return goods. We analyze the right to withdraw in a model that incorporates a tradeoff between allowing consumers to learn about goods that they purchase and protecting sellers from the depreciation of those goods. The right to withdraw—at least, as a default rule—has a plausible economic basis. We identify a nascent version of it in the well-known, controversial case of ProCD v. Zeidenberg.

Number

514

Recommended Citation

Eric Posner & Omri Ben-Shahar, "The Right to Withdraw in Contract Law " (John M. Olin Program in Law and Economics Working Paper No. 514, 2010).

Additional Information

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