Academic journal article Law and Contemporary Problems

Consent, Choice, and Guido Calabresi's Heterodox Economic Analysis of Law

Academic journal article Law and Contemporary Problems

Consent, Choice, and Guido Calabresi's Heterodox Economic Analysis of Law

Article excerpt

I

INTRODUCTION

It is today widely accepted, even if not unanimously admitted, that the works that develop at the intersection between law and economics can be roughly classified into two groups. First, there is the approach known as "law and economics," perfectly exemplified by the works of Ronald Coase, which puts the main focus on economic problems, and takes legal rules and institutions into account only insofar as they can influence economic activities and serve to restore the full working of markets. (1) From a methodological perspective, this law-and-economics approach rests on a definition of economics centered on its subject matter, that is to say, on its scope. It is assumed that economic activities are specifically defined--around the production, consumption, and distribution of wealth--and that the economist's objective and task is essentially to study those activities. Coase consistently and repeatedly claimed this to be his perspective, describing himself primarily as an economist who was not interested in studying the working of the legal system per se. (2) This latter approach, that is, one centered on the legal system, instead

corresponds to the second approach to studying the intersection between economics and law, referred to as the "economic analysis of law." The economic analysis of law is in many ways an opposite viewpoint to law and economics, because it defines economics not by its subject matter--but by its method--a method that can be applied to analyze any kind of problem. In other words, economics is defined as a method that can be used by legal scholars and policy makers for positive and normative analysis, and sometimes for directing adjudication. (3) Essentially, under the economic-analysis-of-law approach, economics becomes functional to law. As a consequence, efficiency, which a number of scholars consider to be somehow inherently ingrained in common-law systems, (4) becomes the main guiding principle inspiring lawmaking and law enforcement. Efficiency has become such a lodestar that some even rely on the rather programmatic hypothesis that laws can in general best be explained in terms of promoting economic efficiency. (5) It follows, from this hypothesis, that legal institutions must simply be evaluated in terms of their welfare-enhancing ability, meaning their capability to promote the optimal use of resources, and that this paradigm should similarly guide the normative perspective.

Formally, the economic analysis of law was "invented" by Richard Posner at the beginning of the 1970s when he published the discipline's eponymous masterpiece, (6) launched the Journal of Legal Studies, and started to write articles in which he explained that economics is an important tool that can be used to analyze (in particular) legal phenomena. (7) Posner's innovation, however, was preceded--by slightly over a decade--by Calabresi's Some Thoughts on Risk Distribution and the Law of Torts (Some Thoughts) in 1961. (8) And in the early 1960s, just as Coase published his seminal The Problem of Social Cost, (9) Calabresi instead somewhat reversed the Coasean trajectory and departed from the standard legal scholarship of his time by using economic tools and analysis to investigate legal questions and the broader issues embedded therein. More specifically, Calabresi's approach diverged from Coase's because he decided to use economics as a tool, that is, as a rigorous methodology that could be used to better understand the working of legal issues. In other words, starting with Some Thoughts and continuing thereafter, Calabresi applied economic methods to analyze legal questions and consequently, according to the aforesaid distinction between economics-as-a-subject-matter and economics-as-amethodology, was proposing an economic analysis of law. (10)

The above evaluation is not an ex post reconstruction; commentators on Calabresi's works perceived it at the time of publication. …

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