Maximizing economic gain through optimal level of incomplete international agreements
The article discusses how to find the best balance in international agreements to maximize benefits while minimizing costs. By using a cost-benefit analysis, parties can determine the optimal level of adding provisions to agreements. This level is reached when the benefit of adding a new provision is greater than the cost of making the change. Parties will keep adjusting the agreement as long as the benefit outweighs the cost, stopping when the cost equals the benefit. This approach helps parties get the most economic gain from the agreement despite high transaction costs. Incomplete agreements are shown to be less than ideal in this context.