An arrangement of this kind--renewable or renegotiable
after a month-would be less likely to generate the problem that Levin envisages: a blackmailer coming back for more after an initial agreement.
Treatment contracts for high-tech home care should thus not only be based on genuinely informed consent; they should also be explicitly renegotiable
throughout the course of the patient's care.
perfectly consistent with the arm's-length standard to treat related-party license agreements generally as renegotiable
arrangements and to require periodic adjustments to the transfer price to reflect substantial changes in the income stream attributable to the intangible," (39) the paper goes on to confirm that where exact comparables exist or evidence is made to the contrary, periodic adjustment would not be required.
In some instances, an efficient LTC can be implemented by a series of short-term, renegotiable
contracts (see Rey and Salanie, 1990, 1996; Malcomson and Spinnewyn, 1988).
We now develop an equilibrium model of debt financing by firm 1 by making the firm's debt level endogenous and by allowing debt to be renegotiable if there is no merger.
However, with renegotiable debt, our earlier assumption that the low-cost firm 2 is all-equity financed is not important, because debt financing by firm 2 no longer has any strategic value.
Second, it is somewhat more renegotiable
than minimum wages or unemployment benefits.
Yet marriage has usually been treated as a status, not a contract, because its terms have traditionally been set by the state and have not been renegotiable
by the parties.
The results are consistent with the argument that firms with public debt outstanding use bank debt because it is more easily renegotiable
, but do not preclude other explanations.