What's new in econ?

At the Austrian Economists blog Peter Boettke asks an interesting question, interesting to other economists at least. He asks What is New in Economics? Boettke explains his question,

Since 1990, what do you consider to be the best economic theory innovations? In my opinion, most of the developments since then that have captured our professional imagination are empirical questions and techniques, not theoretical innovations --- but perhaps I am wrong. Give your nominations --- but don't just list a name, but lets discuss the core insight the name is supposed to capture.

I'm not 100 percent sure it would exactly fit Boettke's time frame, but for me one of the most interesting recent developments is incomplete contracts theory. In particular its use in the theory of the firm and the related area of the theory of privatisation.