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Cornell Journal of Law and Public Policy

Keywords

Binding promises, Market transactions, Promissory obligation, Epistemic rationality

Abstract

Binding promises yield a number of practical benefits, if in fact they are binding. One benefit is coordination. Knowing that she must perform, the promisor can allocate her time and resources more effectively. The promisee, meanwhile, can make plans on the assumption that the promised act will occur.

Markets for future exchange rely on the coordinating power of binding promises. For this purpose, it may be possible in theory to support coordination by designing and enforcing an ideal set of legal rules governing contractual obligation. Almost certainly, however, markets will function more effectively if promises also impose obligations to perform on those who make them.

Apart from coordination, binding promises allow parties to alter the normative relations between them. By voluntarily communicating an intention to be found, the promisor assumes an obligation to the promisee.' In this way, the promisor can both control her own future action and confer power on the promisee either to demand what was promised or to release the promisor.2 At least, the promisor can change the normative picture in this way if the promise is in fact binding.

I begin this Article by canvassing some competing conceptions of promissory obligation, which point to a range of benefits associated with promising. I then turn to theories of practical rationality, showing how it might, under theories of temporally extended practical rationality, be practically rational to treat a promise as binding. I then take a brief look at standards of epistemic rationality. Next, I consider the epistemic circumstances of a promisor, both at the time of promising and at the time of performance. I conclude that despite whatever practical and normative benefits binding promises may have, it will not always be epistemically rational for promisors to perform. To the extent that markets rely on binding promises, therefore, they rely on an element of irrationality in human decision-making.

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