We study contingencies written in firms' material product market contracts, focusing on the theoretical prediction of uncertainty as an important determinant. We identify contract contingencies from firms’ public regulatory filings and examine the effects of general business uncertainty and specific innovation-related uncertainty. To enhance causal inference, we utilize two major business shocks (i.e., the 2008 Financial Crisis and the COVID pandemic) and the diffusion of 29 disruptive innovation shocks (Bloom et al., 2021). We also explore the effects of re-negotiation costs and writing costs. Overall, our empirical results are consistent with predictions from dynamic models of incomplete contracting.

中文翻译：

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合同或有事项和不确定性：来自产品市场合同的证据


我们研究公司材料产品市场合同中写的或有事项，重点是不确定性作为重要决定因素的理论预测。我们从公司的公开监管文件中确定合同或有事项，并研究一般业务不确定性和特定创新相关不确定性的影响。为了增强因果推理，我们利用了两个主要的商业冲击（即 2008 年金融危机和 COVID 大流行）和 29 个颠覆性创新冲击的扩散（Bloom et al.， 2021）。我们还探讨了重新谈判成本和写作成本的影响。总体而言，我们的实证结果与不完整合同的动态模型的预测一致。