Myopic And Far-Sighted Contracts Definition

A myopic contract is one where the terms are not favorable to the company in the long run. This may be because the company was desperate for cash and had to accept unfavorable terms, or because the negotiators were not experienced enough to realize what they were agreeing to. Either way, a myopic contract can be disastrous for a company if things do not go as planned.

A far-sighted contract is one where the terms are favorable to the company in the long run. This may be because the company was able to negotiate better terms, or because the negotiators were experienced and knew what they were doing. Either way, a far-sighted contract can be beneficial for a company if things go as planned.