Contracts that involve the government differ from contracts between two private parties in that the identity of one of … government to renegotiate it. I show that traditional damage measures used in contracts between two private parties exacerbate … the parties, the government, is subject to change. Given that the incumbent government knows that it might not be in power …

contracts offer protection against dismissals: turnover probability increases by 12% each year closer to expiration. This should … contracts make it harder to dismiss managers, they also impose less discipline. Consistent with this argument, CEOs with a …