Consumer contract theory is myopically focused on the unread fine print. Because consumers don’t read their contracts, firms can make “hidden” terms worse without lowering prices.
January
2025
I would like to thank the individuals who agreed to be interviewed for this article: Hissan Bajwa, Michal Rosenn, Bonnie Broeren, Rob Chesnut, Eric Goldman, Jay Monahan, Ari Shahdadi, Curtis Anderson, Ed Ferguson, Michael Cheah, Hansen Tong, and Miranda Lerner. Katherine Schloss Ackerman (Penn ’17), Elyssa Eisenberg (Penn ’18), and Michelle Kao (Penn ’18) provided research assistance. Tom Baker, Shyam Balganesh, Danielle Citron, Zev Eigen, Meirav Furth-Matzkin, Eric Goldman, Ethan Leib, Sophia Lee, Greg Klass, Florencia Marotta-Wurgler, Melanie McMenamin, Lior Strahilevitz, Rick Swedloff, Michael Risch, Tess Wilkinson-Ryan, David Wishnick, and participants at faculty workshops at the University of Pennsylvania, Boston University, UC Hastings, Villanova University, University of Chicago, and the Second Empirical Contracts Working Group provided useful feedback.
Consumer contract theory is myopically focused on the unread fine print. Because consumers don’t read their contracts, firms can make “hidden” terms worse without lowering prices.
We thank Kenworthy Bilz, Bernard Harcourt, Owen Jones, Sarah Lawsky, Richard McAdams, Janice Nadler, Kitty Richards, Stephanie Stern, and Lior Strahilevitz for their comments and advice.
We thank Jane Baron, Craig Green, Zev Eigen, Yuval Feldman, Bob Hillman, Greg Mandel, Rafael Pardo, Alex Radus, Brishen Rogers, David Zaring, and participants at faculty colloquia at Vanderbilt Law School, the Wharton School at the University of Pennsylvania, University of Washington, William & Mary Law School, as well as at the Conference on Empirical Legal Studies for comments on earlier drafts.