Deals. The Economic Structure of Business Transactions

Oliver Hart, a Nobel laureate in Economics, describes this work as an essential asset for anyone keen on understanding real-world contracts and transactions. Leveraging a plethora of real-life examples from various sectors, two renowned authorities provide a nuanced yet approachable compendium on crafting business agreements aimed at optimizing value. Business dealings can manifest in countless ways, such as corporate takeovers or securing top-tier talent, with the ultimate aim being the maximization and equitable distribution of joint value. With a wealth of experience advising on commercial transactions, Michael Klausner and Guhan Subramanian illuminate the path to achieving this objective by crafting incentives, addressing information imbalances, and respecting each party's entitlements and duties. The book, "Deals," encapsulates the complexities of real-world transactions through case studies that include Microsoft's purchase of LinkedIn, a legal battle between Disney and Scarlett Johansson, LVMH's acquisition of Tiffany disrupted by the pandemic, and NBC/Viacom's deal with Paramount concerning the final seasons of "Frasier," among others. Klausner and Subramanian adeptly define negotiation frameworks and explicate the economic theories underpinning value optimization. They navigate the intricacies of moral hazard, opportunism, and address typical risks in long-term agreements. By uniquely integrating economic principles into real-life negotiations, "Deals" serves as a crucial tool for both students and professionals engaged in business and legal sectors.