Law & Economics Papers
Academic Papers on Law and Economics
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The Economic Analysis of Law in New Zealand - Jason Varuhas
This paper analyses the place of Law and Economics in legal decision-making in New Zealand and seeks to spur discussion and scholarship in the area of Law and Economics in New Zealand, especially within the legal profession. The paper provides a brief introduction to the Law and Economics discipline, assesses the state of Law and Economics scholarship and its use in the New Zealand legal system. It provides a brief introduction to the fundamental principles of economics, advocates the use of Law and Economics in legal decision-making in New Zealand, discusses the benefits of such use, and outlines applications of economics to law drawing on New Zealand case law. The paper goes on to discuss several criticisms of the discipline and the proper role of economic analysis in the law.
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Lost in Translation: The Economic Analysis of Law in the United States and Europe - Kenneth Glenn Dau-Schmidt and Carmen L Brun
ABSTRACT: In this essay, we examine the reasons why the economic analysis of law has not flourished in European countries as it has in the U.S. In particular, we focus on three European countries - the United Kingdom (U.K.), Germany, and France. We argue that differences in culture, the legal system and the academy have led to differing degrees of success of the law and economics movement in each country. We speculate that, although there is currently less interest in the economic analysis of the law in Europe than in the United States, European interest could dramatically increase if scholars adopt more communitarian analyses aimed at analyzing legislative polices rather than judicial decisions.
Law and Economics - And Why New Zealand Needs It - Sir Ivor Richardson
The so-called Chicago School of law and economics, which emerged in the late 1970s, was regarded by many lawyers with considerable suspicion. Much of this suspicion was due to the artificial and unrealistic nature of the assumptions about human motivation that underpinned that School's analysis. In the present paper, first delivered at the New Zealand Law Conference at Christchurch in October 2001, Sir Ivor Richardson reviews developments in the law and economics movement and highlights the growing sophistication of the economic analysis that can be brought to bear on legal issues. In Sir Ivor's view, neither judges nor lawmakers should make laws without regard to the full benefits and costs of those laws. He suggests that while economics alone cannot dictate their outcome, economics has an important role to play in a wide variety of cases.
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The Success of Law and Economics: A Methodological Interpretation - Bingyuang Hsiung
ABSTRACT: The development of law and economics is a success story of the expansion of economics into other social sciences since the 1960s. The success has been attributed to the fact that economics offers a powerful set of analytical tools and a forceful theory of human behavior. But if this is the only reason, then the move of economics into other social sciences such as political science, sociology, etc. should have been equally successful. This, however, is not true. It is argued in this paper that the commonality between economics and law on the subject matter provides the additional explanatory factor. Moreover, the commonality between economics and law on the analytical approach is examined and the implications derived.
The History of Law and Economics - Ejan Mackaay
ABSTRACT: The idea of applying economic concepts to gain a better understanding of law is older than the current movement, which goes back to the late 1950s. Key insights of law and economics can already be found in the writings of the Scottish Enlightenment thinkers. The Historical School and the Institutionalist School, active on both sides of the Atlantic between roughly 1830 and 1930, had aims similar to the current law and economics movement.
During the 1960s and 1970s the Chicago approach to law and economics reigned supreme. After the critical debates in the United States between 1976 and 1983, other approaches came to the fore. Of these, the neo-institutionalist approach and the Austrian approach, both corresponding to schools within economics proper, are worth watching.
Law and economics has progressively found its way to countries outside the United States. From the mid 1970s onwards it reached the English speaking countries, then other countries as well. In no country has law and economics had as much impact as it has in the United States.
Address to Inaugural Law and Economics Course - Sir Ivor Richardson
There are two features of the New Zealand legal system which makes Economics and Law an important field of study. The first is that the courts allocate and reallocate resources and their decisions necessarily affect the use of society’s limited resources. Justice may be priceless. But it is not costless. The second feature is that, like economics, the legal system is concerned with behaviour. It seeks to influence behaviour by establishing rules of conduct and imposing sanctions for their breach. Rules and sanctions should be designed and decisions made having regard to resource implications.
Economic analysis is not an Aladdin's lamp. There is more at stake than market trade-offs. Efficiency concerns are only one factor in an assessment of the public interest. But we need to appreciate the economic costs of less efficient solutions.
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Why Be Apologetic About Law and Economics - Bernard Robertson
Those proposing that greater attention be paid to Law and Economics often genuflect in the direction of two ideas. First, the government or community may legitimately follow goals other than economic efficiency, and, second, there are values which cannot be measured in economic terms. This is unfortunate and based on false premises...
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Economics and the Judges: The Case for Simple Rules and Boring Courts - Richard Epstein
This paper investigates the use of economic theory by common law judges. I shall begin that inquiry by propounding a gentle paradox. Great progress has undeniably been made over the last two generations, both in the science of economics and, more specifically, in the law and economics movement. Today we can analyse, in a more sophisticated fashion than formerly, a range of economic processes that are relevant to legal issues. We know something of the impact that legal rules have on social behavior and how economic theory can assist in choosing the efficient legal rule. Given these academic advances, we might have imagined that this new knowledge would slowly diffuse itself throughout the legal profession and the courts. We could hope therefore to see the development of a judicial body of knowledge reflecting many of these academic advances. Yet the opposite is largely true. A little learning-or even a great deal of learning-can sometimes be a dangerous thing. The legal profession today seems not unlike an overstretched juggler who tries to keep too many balls in the air at once. In attempting to do too much he gets himself into a terrible tangle, and the balls come clattering down and fall at his feet.
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A Traditional and 'Behavioral' Law-And-Economics Analysis of Williams v. Walker-Thomas Furniture Company - Russell B. Korobkin
Williams v. Walker-Thomas Furniture Company is a casebook favorite, taught in virtually every first-year Contract Law class. In the case, the D.C. Circuit holds that courts have the power to deny enforcement of contract terms if the terms are "unconscionable," and it remands the case to the lower court to consider whether the facts of the case meet this standard. This article, written for a session of the 2004 AALS Annual Meeting sponsored by the Contracts Section, analyzes the question that the D.C. Circuit posed to the lower court in Williams - and that Contracts teachers routinely pose to their students - from a "traditional" law-and-economics perspective, and from a "behavioral" law-and-economics perspective.
Richard Epstein "Defining Social Welfare – and Achieving It"
Richard Epstein argues that despite the benefits of property rights and competition in raising human welfare, governments frequently violate the property rights for their own ends. This, he argues, is bound to reduce human welfare.
Suri Ratnapala "Environmentalism vs Constitutionalism: A Contest With No Winners"
This essay is about two threats to society. One is to the environment that, if unattended, will endanger our way of life. The other is to constitutional government and to the economy that arises from ill-advised responses to the challenges of environmental protection. The latter threat, if unaddressed, will not only endanger our way of life by diminishing freedom and prosperity but, in the end, will also defeat our good intentions about the environment. This paper is in three parts. In Part 1, I discuss aspects of the current environmental debate as background for considering the legal and policy issues that I go on to address. This is not a scientific paper, and I make no claim for the validity of any opinion I express on the relevant science. All I wish to do in Part 1 is highlight a specific impediment to the discussion of the issues, namely, the perception that the debate is over as regards the existence and scale of the threats to the environment, and that we have no choice left but to embrace the command and control agenda. In Part 2, I undertake three tasks. First, I discuss the central ideas of constitutionalism and their relevance to the challenges posed by environmental concerns. Second, I discuss in this context the state of the law in New Zealand and elsewhere with respect to the regulation of property use and the question of compensation. Third, I address criticisms of the classical view of constitutionalism that are made by those who support robust regulation and the subordination of property rights to other interests. In Part 3, I consider the ways in which current resource management laws, including the New Zealand Resource Management Act 1991, affect property rights, the rule of law and constitutionalism.
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