A THEORETICAL AND EMPIRICAL INVESTIGATION OF CONTRACTUAL PROVISIONS WHICH INHIBIT FRANCHISEE COMPETITION AFTER TERMINATION
Abstract
When individuals transact they operate under contracts which specify their duties and obligations to one another. These contracts can either be implicit as in the form of moral codes of conduct, or they may be explicit as is the case with governmental regulations or typical business contracts. One purpose of a contract is to inhibit certain types of behavior deemed inappropriate for the contractual relationship. It is very common, however, for contracts to restrain other activities of the parties. This study points out that these indirect constraints can be beneficial in several ways, not the least of which is that they can raise the cost, to the violator, of breaching the direct restrictions. Consequently, the parties are typically presented with multiple restrictions, each of which contributes toward a single ultimate objective. This research looks at this phenomenon in the context of employment agency and real estate agency franchise contracts. Specific attention is focused on those provisions which inhibit the franchisee's ability to engage in a similar business after terminating the franchise relationship.
Degree
Ph.D.
Subject Area
Economic theory
Off-Campus Purdue Users:
To access this dissertation, please log in to our
proxy server.