5IE452 – Economics and the Law
Students are introduced to the historical overview and contemporary approaches to law-and-economics. The course explains the link between economics and existing institutional setting and clarifies the limits of market co-ordination mechanism.
Upon successful completion of this course, students will be able to explain the links between economics and law. They will be able to identify the impacts of competition upon the quality of institutional environment.
|1. Methodological introduction, the role of property in economic thinking
The overview of the role of property in the history of economic thought – Smith, Marx, early 20th century, post WWII development
2. Emergence of law-and-economics as a distinct economic discipline
Aaron Director, Ronald Coase, Journal of Law and Economics and the emergence of Chicago law-and-economics.
3. The Coase Theorem and its application. The origin, nature, implications and criticism of the Coase theorem
4. Coase, Posner, Calabresi and their approaches to law-and-economics Divisions inside law-and-economics – the essence of different approaches.
5. Legal-economic nexus
The approach of Carl Menger and the origin of legal-economic nexus.
6. Property I
7. Property II
Implications of legal-economic nexus. Efficiency of law, the theory of entrepreneurial margins.
8. The role of entrepreneur and efficiency considerations
Dynamic approach to law-and-economics, the role of entrepreneurial discovery.
9. Property, efficiency and co-ordination.
James Buchanan, Richard Posner, Douglas North and the battle over efficiency.
10. Law and legislation
Gustave de Molinari, Frédéric Bastiat, F. A. Hayek, Bruno Leoni – discussion about the nature of law and legislation. Planning and competition – economics vs. the law?
11. Case study I – Intellectual property
Patents, copyrights, trade secrets – law-and-economics view on intellectual property
12. Case study II – Economics and the law of environmental protection
Šíma, Josef : Introduction to the Logic of Social Action:Law&Economics Primer
Readings for seminars:
1. Introductory seminar
2. Emergence and evolution of property rights:
A: Laura Huggins, Terry Anderson: Property Rights: A Practical Guide to Freedom and Prosperity – Chapter 1 – „What are property rights?„
B: Laura Huggins, Terry Anderson: Property Rights: A Practical Guide to Freedom and Prosperity – Chapter 3: Where Do Property Rights Come From?
3. Economics of protection and risk-reduction:
A: Daniel Klein – Quality-and-Safety Assurance: How Voluntary Social Processes Remedy Their Own Shortcomings (one popular piece for those who like read more – „Should The Government Kill People To Protect Their Health?“)
B: Sam Peltzman: Regulation and the Wealth of Nations: The Connection between Government Regulation and Economic Progress, vol. 3, no. 2, New Perspectives on Political Economy
4. Economics and the Environment
A. Roger E. Meiners and Bruce Yandle: The Common Law: How it Protects the Environment (česky zde )
B: Two shorter pieces: Daniel K. Benjamin – Eight Great Myths of Recycling (in Czech Osm mýtů o recyklaci), Murray Rothbard – Vláda jako zdroj znečištění vody a ovzduší
5. Economics, institutions and development
A: James Tooley – Backing the Wrong Horse: How Private Schools Are Good for the Poor, Freeman May, 2006
B: William Easterley – „Was Development Assistance a Mistake?“ American Economic Review, May 2007, Vol. 97, No.2, 328-332
6. Privately produced law
A: T. L. Anderson & P.J. Hill – An American Experiment in Anarcho-Capitalism: The Not So Wild, Wild West Journal of Libertarian Studies, Vol. 3, no. 1, 1979
B: David Friedman – Private Creation and Enforcement of Law: A Historical Case, Journal of Legal Studies 8, 1979r
7. Market for law
A. Boettke – Anarchism as a Progressive Research Program in Political Economy
B. Bruno Leoni – Freedom and the Law– chap. 1 (in Czech)
Robert Higgs: Banning a Risky Product Cannot Improve Any Consumer’s Welfare (Properly Understood), with Applications to FDA Testing Requirements
Group B (surnames N-Z):“Should The Government Kill People To Protect Their Health?“
Murray Rothbard: Law, Property Rights, and Air Pollution (česky zde) Group A pages 121-145, Group B pages 146-170
Murray Rothbard: Law, Property Rights, and Air Pollution
Rizzo, Mario: “The Mirage of Efficiency”, Hofstra Law Review, vol. 8, no. 3, Spring 1980
Boettke, Peter: “The New Comparative Political Economy”, Forum Series on the Role of Institutions in Promoting Economic Growth – Forum 6, April 4, 2003
Frédéric Bastiat: The Law
Crespi, Gregory Scott: “Exploring the Complicationist Gambit: An Austrian Approach to the Economic Analysis of Law“, Notre Dame Law Review, vol. 73, no. 2, January 1998
Bouckaert, Boudewijn and De Geest, Gerrit (eds.), Encyclopedia of Law and Economics, Volume I. The History and Methodology of Law and Economics , Cheltenham, Edward Elgar, 2000
1. The role of property in economic thought
Mises, Ludwig: “Harmony and conflict of interest”, Human Action, Fox & Wilkes, 1966
Armen A. Alchian: Property Rights
Hayek, F. A.: “The Challenge to Property”, The Fatal Conceit, The University of Chicago Press, pp. 48–52
Rothbard, Murray: Economic Thought before Adam Smith and Classical Economics, Edward Elgar, 2 volumes, 1995
Clark Nardinelli: Industrial Revolution and the Standard of Living
Todd J. Zywicki: The Rule of Law, Freedom, and Prosperity
North, Douglass C.: Institutions, Institutional Change and Economic Performance, Cambridge University Press, 1990
Coase, Ronald: Essay on Economics and Economists, University of Chicago Press, 1994
2. Origin of law&economics.
Mackaay, Ejan: “History of Law and Economics“ in Bouckaert, Boudewijn and De Geest, Gerrit (eds.): Encyclopedia of Law and Economics, vol. I, Edward Elgar, 2000
Coase, Ronald H.: “The Problem of Social Cost“, Journal of Law and Economics, vol. III, October 1960
Coase, Ronald H.: “The Institutional Structure of Production”, Nobel Lecture
3. The Coase theorem and its application.
“Looking for Results: Nobel laureate Ronald Coase on rights, resources, and regulation“, Reason Magazine, January 1997
Coase, Ronald H.: The Firm, the Market and the Law, University of Chicago Press, 1990
Medema, Steven G and Zerbe, Richard O. Jr.: “The Coase Theorem” in Bouckaert, Boudewijn and De Geest, Gerrit (eds.): Encyclopedia of Law and Economics, vol. I, part 0730, Edward Elgar, 2000
4. Coase, Posner, Calabresi and their approaches to law&economics.
Walter Block: „Ethics, Efficiency, Coasian Property Rights, and Psychic Income: A Reply to Harold Demsetz“, Review of Austrian Economics, vol. 8, no. 2, 1995
Demsetz, Herold: „Block’s Erroneous Interpretations“, Review of Austrian Economics, vol. 10, no. 2, 1997
Walter Block: „Private-Property Rights, Erroneous Interpretations, Morality, and Economics: Reply to Demsetz“, The Quarterly Journal of Austrian Economics, vol. 3, no. 1, Spring 2000
Walter Block: „O.J.’s Defense: A Reductio Ad Absurdum of the Economics of Ronald Coase and Richard Posner,“ European Journal of Law and Economics, 1996, Vol. 3, pp. 265-286
Edward Stringham: “Kaldor-Hicks Efficiency and the Problem of Central Planning” Quarterly Journal of Austrian Economics, Vol. 4, No. 2 (Summer 2001) 41-50
5. Legal-economic nexus
Frédéric Batiat: Economic Harmonies, chap. 1. “Natural and Artificial Social Order”
Randy Barnett: Toward a Theory of Legal Naturalism, Journal of Legal Studies, 1978
Edward Stringham: “Economic Analysis of Tort Law: Austrian and Kantian Perspectives” (with Mark White) in Law and Economics: Alternative Economic Approaches to Legal and Regulatory Issues, Margaret Oppenheimer and Nicholas Mercuro (eds.) New York: M.E. Sharpe, forthcoming.
6. Property I – human bodies
7. Property II – ownership of non-human entities
Hans-Hermann Hoppe: The Theory of Socialism and Capitalism, An Economico-Philosophical Treatise, Kluwer Academic Publishers, 1989 (chap. 2)
Frédéric Bastiat: Selected Essays on Political Economy, Foundation for Economic Education, 2001, chap. Property and Law
Garrett Hardin: The Tragedy of the Commons
Ludwig Mises: Human Action, chap. “The Limits of Property Rights and the Problems of External Costs and External Economies”
8. Entrepreneurship and efficiency
Paul Heyne: Efficiency
Hayek, F. A.: “Competition as a Discovery Procedure”, Quarterly Journal of Austrian Economics, vol. 5, no. 3, Fall 2002
Bruno S. Frey – A Utopia? Government Without Territorial Monopoly, The Independent Review: A Journal of Political Economy, Volume 6, Number 1, Summer 2001
Tom W. Bell – Privately Produced Law, Libertarian Alliance, Legal Notes, 16, 1991
Tom W. Bell – The Jurisprudence Of Polycentric Law, Unpublished Manuscript, Chicago, Illinois, August, 1992
Tom W. Bell – Polycentric Law in the New Millennium, Essay submitted to the Mont Pelerin Society, 1998
O’Hara, Erin A. and Ribstein, Larry E.: “From Politics to Efficiency in Choice of Law“, Working Paper GMU School of Law, December 1999
Edward Stringham: “Market Chosen Law” Journal of Libertarian Studies Vol. 14, No.1 (Winter 1998-1999) 53-77
George H. Smith – Justice Entrepreneurship in a Free Market, Journal of Libertarian Studies, Vol. 3, No. 4, 1979
Randy E. Barnett – Comment on Smith
Steven Strasnick – Comment on Smith
Robert L. Formaini – Comment on Smith
George H. Smith – Reply to Critics
9. Efficiency and coordination
F.A. Hayek: „The Use of Knowledge in Society„
David Friedman – Anarchy and Efficient Law, For and Against the State (ed. John T. Sanders and Jan Narveson),Rowman & Littlefield, 1996, p. 235-253
10. Law and the State
T. L. Anderson & P.J. Hill – An American Experiment in Anarcho-Capitalism: The Not So Wild, Wild West Journal of Libertarian Studies, Vol. 3, no. 1, 1979
David Friedman – Private Creation and Enforcement of Law: A Historical Case
Journal of Legal Studies 8, 1979
Stephen Davies – The Private Supply of `Public Goods‘ in Nineteenth Century Britain (pdf)
Libertarian Alliance, Historical Notes, 03, 1988
Edward Stringham: “The Extralegal Development of Securities Trading in Seventeenth Century Amsterdam” Quarterly Review of Economics and Finance, Vol. 43, No. 2 (Summer 2003) 321-344.
Edward Stringham: “The Emergence of the London Stock Exchange as a Self-Policing Club” Journal of Private Enterprise, Vol. 17, No. 2 (2002) 1-19.
Bruce L. Benson – Enforcement of Private Property Rights in Primitive
Societies: Law without Government, Journal of Libertarian Studies, Vol. 9, Num. 1, 1989
Bruce L. Benson – Customary Law With Private Means of Resolving Disputes and Dispensing Justice: A Description Of a Modern System of Law and Order Without State Coercion, Journal of Libertarian Studies, Vol. 9 Num. 2, 1990
Bruce L. Benson – Reciprocal Exchange as the Basis for Recognition Of Law: Examples from American History,
Journal of Libertarian Studies, Vol. 10, Num. 1, 1991
John D. Sneed – Order without Law: Where will Anarchists Keep the Madmen ?, Journal of Libertarian Studies, Vol. 1, No. 2, 1977
11. Law and legislation
Tom Palmer: „Freedom and the Law: A Comment on Professor Aranson’s Article,“ with Leonard P. Liggio, Harvard Journal of Law & Public Policy
Stephan N. Kinsella – Rationalism, Legislation, and Law, Journal of Libertarian Studies, Vol. 11, Num. 2, 1995
Benson, Bruce L.: “The Impetus for Recognizing Private Property and Adopting Ethical Behavior in a Market Economy: Natural Law, Government Law, or Evolving Self-Interest”, The Review of Austrian Economics, vol. 6, no. 2, 1993.
11. Real-world legal systems
Roger E. Meiners and Bruce Yandle: The Common Law: How it Protects the Environment
Block, Walter, „Environmentalism and Freedom: The Case for Private Property Rights,“ Journal of Business Ethics, Vol. 17, No. 6, December 1998, pp. 1887-1899
Anderson, Terry L. and Huggins, Laura E.: Property Rights: A Practical guide to Freedom and Prosperity, Hoover Institutions Press Publications, 2003
Palmer, Tom G.: „Intellectual Property: A Non-Posnerian Law and Economics Approach“, Hamline Law Review, vol. 12, no. 261, 1989
Kinsella, Stephan N.: „Against Intellectual Property“, Journal of Libertarian Studies, vol. 15, no. 2, Spring 2001
Punishment and Restitution
Stephan N. Kinsella – Punishment and Proportionality: the Estoppel Approach, Journal of Libertarian Studies, Vol. 12, Num. 1, 1996
Bruce L. Benson – Restitution in Theory and Practice, Journal of Libertarian Studies, Vol. 12, No. 1, 1996
12. What should lawyers do?
Bryan Caplan – The Economics of Non-State Legal Systems, Libertarian Alliance, Legal Notes, 26, 1997
John Hasnas: Once More unto the Breach: The Inherent Liberalism of the Criminal Law and Liability for Attempting the Impossible
Michael I. Krauss: Restoring the Boundary Tort Law and the Right to Contract
Murray Rothbard: For a New Liberty: The Libertarian Manifesto, chap. 11 (The Public Sector, III: Police, Law, and the Courts. 219)
Gustave de Molinari: Private Production of Security
Murray Rothbard’s introduction
David Friedman – Police, Courts, and Laws-on the Market, in The Machinery of Freedom: Guide to A Radical Capitalism, Open Court, 1973 (1989 second edition)
Anthony de Jasay: The State
Hayek, F. A., The Road to Serfdom. Chicago, 1944, 56-100; 134-152.
Hayek, F. A., Law, Legislation and Liberty. Chicago, 1973, 1-54; 94-144.
Hernando de Soto, The Other Path. Harper and Row, 1989, 131-187.
Bruce Benson, Customary Law With Private Means of Resolving Disputes and Dispensing Justice: A Description Of a Modern System of Law and Order Without State Coercion, Journal of Libertarian Studies, sv. 9, č. 2 (www.mises.org)
Friedman, David: Law’s Order, What Economics Has To Do With Law And Why It Matters, Princeton University Press, 2000
Alchian, Armen A. and Demsetz, Harold: „The Property Right Paradigm“, The Journal of Economic History, vol. 33, no. 1, March 1973
Barnett, Randy E.: The Structure of Liberty, Clarendon Press, 1998
Berman, Harold J.: Law and Revolution, Harvard University Press, 1983
Bethell, Tom: The Noblest Triumph, Property and Prosperity through the Ages, St. Martin’ Press, 1998
Šíma, Josef: “Intelektuální vlastnictví”, Politická ekonomie (forthcoming)
Šíma, Josef: „Spor o metodu uvnitř ekonomie a práva“, Filosofické základy metodologie ekonomických věd II, VŠE, 2003
Šíma, Josef: “Francouzský harmonismus jako jednota ekonomie a práva”, Introductiion to Salin, Pascal: Ekonomická harmonizace, Liberální institut, 2003
Ellickson, Robert C.: Order without Law, Harvard University Press, 1991
Benson, Bruce: The Entreprise of Law, Pacific Research Institute for Public Policy, 1990
Epstein, Richard A.: Simple Rules for a Complex World, Harvard University Press, 1995
Medema, Steven G. (ed.): The Legacy of Ronald Coase in Economic Analysis, vol. I and II, Edward Elgar Publishing, 1995
Pipes, Richard: Property and Freedom, Alfred A. Knopf, 1999
Rizzo, Mario J.: „Law Amid Flux: The Economics of Negligence and Strict Liability in Tort“, Journal of Legal Studies, vol. IX, no. 2, March 1980
Rizzo, Mario J.: „Rules versus Cost-Benefit Analysis in the Common Law“ in Dorn, James A. a Manne, Henry G.: Economic Liberties and the Judiciary, George Mason University Press, 1987
Rizzo, Mario J.: „Uncertainty, Subjectivity, and the Economic Analysis of Law“ in Rizzo, Mario J. (ed.): Time, Uncertainty, and Disequilibrium, LexingtonBooks, 1979
Ludwig Mises & Murray Rothbard