THE LIMITS OF PRIVATE POWERS: A LAW AND ECONOMICS FOUNDATION OF THE ITALIAN CASE-LAW ON THE USE OF “GOOD FAITH CLAUSE”

carlo carrera (MILAN)

Abstract

The paper aims at finding a rational and economics foundation to the jurisprudential use of the "good faith clause". Starting from Grossman/Hart/Moore model of incompleteness of contracts, it shows that the problem of abuse of residual rights of control has been tackled by the Italian Civil Supreme Court by means of the "good faith clause". So, at the end, it is an example of how economics theories and legal solution can, perhaps surprisingly, converge to the same results, despite their different background

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