Economic Analysis of Contract Law: How the Eyes of Economics Work While Delivering Justice with Unprejudiced Hands of Existing Indonesian Contract Law

Abstract

Legal issues surrounding contracts are never easy to solve, especially those concerning the nature and rules of contract law amid the development paradigm of the law itself. It is not surprising that one of the classic problems of contract law lies in the suitability of regulatory governance which is expected to be able to adapt to the demands of the times and its relevance on the actual side. This shows that the law is prone to aging. This kind of rapid change makes the age of law like corn, so legal restoration cannot be focused/expected on legal reform alone. On the existing paradigm, Law and Economics offers several concepts as an ideal model that can guide legal activities while uniting the disparity of legal outcomes. Some fundamental concepts of economics can be constellated with the law as an economic approach to law, in this case, contract law, to re-concretize legal needs in contracting. Contract performance as a legal practice must also go hand in hand with other social activities. Here, Law and Economics is present to obtain clarity of contract law to be more responsive, relevant, contextual, and actual.