The Charles E. Gerber Deals course will focus on the analysis of the contract documents memorializing a variety of interfirm business transactions. We hope to learn more about the patterns of contractual governance that have emerged with respect to different types of transactions: how do parties order their commercial interactions? Perhaps more important, we hope to be able to build on that learning to teach how parties may more effectively govern their relations: how should parties order their commercial interactions?
The course will be composed of two parts. The first, lasting four to six weeks, is designed to introduce the students to the economic tools necessary to evaluate alternative contractual regimes, including transaction costs, information economics, risk sharing and incentives, property rights, and finance. Students also will work through some of the existing empirical work on contracting regimes.
The second half of the course will apply the tools developed in the first part to real transactions. Each week the class will consider a different real-world transaction, with the particular transactions selected to give the students a range of subject matter so as to highlight a common set of problems that arises in all settings. For example, in one semester the class might examine a movie financing transaction, a real estate syndication, a venture capital transaction, and a joint venture agreement.
Each transaction will be allocated two classes. For the first class, a team of students will prepare readings that include the actual transaction documents, an overview of the legal and regulatory structure of the industry, and a description of the strategic and competitive characteristics of the industry. The students then will apply the analytic tools they have learned to understanding the structure of the transaction. In the second class, a presentation will be made by the lawyers and/or principals who actually participated in the transactions. The goal is to give students the opportunity to test how the class approach corresponds to the way those who "did the deal" understood it.