Renegotiation Empowers Consumers to Outsmart Businesses' Manipulative Tactics
The article explores how contracts can be designed to prevent renegotiation issues caused by changing preferences over time. By considering different discounting functions for the agent and principal, the researchers found an optimal contract that is resistant to renegotiation. They showed that this contract can be described using a specific mathematical system and can be solved in certain cases. The findings have practical applications in various scenarios.