Most, if not all, trade liberalization agreements amount to incomplete contracts between the participant states. Contractual incompleteness pushes us to analyse such events using lenses other than traditional contract theory and principal-agent models. Hence, over the years, political scientists have argued that such incompleteness is due either to the presence of significant transaction costs, or to the bounded rationality of the negotiators and the signatories. In this paper we argue that incompleteness may be due to a third, heretofore largely neglected factor, namely the desire of one or more parties to signal their true commitment to prolonged cooperation. More specifically, one or more countries may refrain from asking fuller clauses lest the others infer from that act that the former intend to take advantage of the pre-defined rule. We probe the plausibility of our argument against two detailed case studies from distinctive historical periods: the creation of the European Coal and Steel Community in the early 1950s, and the trans-atlantic Open Skies Agreement in the 2000s.
