IDEAS home Printed from https://ideas.repec.org/a/bpj/jeehcn/v7y1996i1n2.html
   My bibliography  Save this article

Law and the Market Order. An Austrian Critique of the Economic Analysis of Law

Author

Listed:
  • Krecke Elisabeth

    (Université d’Aix-Marseille III)

Abstract

L'article présente une étude critique des fondements méthodologiques de l'analyse économique du droit traditionnelle dans laquelle le droit est conçu comme le résultat optimal d'une comparaison de coûts et d'avantages sociaux. Cette procédure judiciaire qui vise en fait à simuler des solutions de marché "socialement efficientes" présuppose inévitablement l'omniscience du juge. Cependant dans le contexte de l'équilibre général, l'analyse économique du droit traditionnelle n'a pas de raison d'être, alors qu'elle s'avère impraticable dans le monde réel où elle serait pourtant nécessaire afin de résoudre des problèmes de coordination entre les individus. A cet égard la théorie économique de l'Ecole Autrichienne qui insiste sur les problèmes informationnels de la société et qui décrit le droit comme une procédure de coordination fondée sur des règles abstraites de juste conduite, semble fournir des fondements plus appropriés pour une approche économique du droit. L'article utilise la méthodologie Autrichienne pour reconsidérer l'analyse économique du droit tout en insistant à la fois sur la dimension institutionnelle et la dimension éthique du droit. Le problème central est l'interdépendance entre le droit et l'ordre de marché, mais il est analysé dans des termes fondamentalement différents de ceux de l'analyse traditionnelle.The paper presents a critical analysis of the methodological foundations of conventional law and economics, where law is generally described as the optimal outcome ot a judicial balancing of social costs and benefits. This law making procedure which aims at simulating "socially efficient" market outcomes inevitably presupposes Judges' omniscience. Nevertheless, in this context of full coordination, this type of law has no raison d'être, whereas it turns out to be infeasible in the real world where it would be necessary in order to solve information and coordination problems. In this respect, Austrian economic and legal theory which focuses on the knowledge problem of society and which describes law as a coordination procedure built on abstract rules of just conduct, seems to provide more appropriate foundations for an economic analysis of law. This paper uses the Austrian approach to reconsider economic analysis of law in a way that allows for both the institutional and the ethical dimensions of law. The central problem seems to lie in the interdependance of law and the ethical dimensions of law. The central problem seems to lie in the interdependancc of law and the market order but it is conceived in a very different way than it is in conventional analysis.

Suggested Citation

  • Krecke Elisabeth, 1996. "Law and the Market Order. An Austrian Critique of the Economic Analysis of Law," Journal des Economistes et des Etudes Humaines, De Gruyter, vol. 7(1), pages 1-21, March.
    • Handle: RePEc:bpj:jeehcn:v:7:y:1996:i:1:n:2
    DOI: 10.2202/1145-6396.1192
    as

    Download full text from publisher

    File URL: https://doi.org/10.2202/1145-6396.1192
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.2202/1145-6396.1192?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Demsetz, Harold, 1969. "Information and Efficiency: Another Viewpoint," Journal of Law and Economics, University of Chicago Press, vol. 12(1), pages 1-22, April.
    2. Heiner, Ronald A, 1983. "The Origin of Predictable Behavior," American Economic Review, American Economic Association, vol. 73(4), pages 560-595, September.
    3. Posner, Richard A, 1987. "The Law and Economics Movement," American Economic Review, American Economic Association, vol. 77(2), pages 1-13, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Walter Block, 2005. "Value Freedom, Laissez Faire, Mises, and Rothbard," American Journal of Economics and Sociology, Wiley Blackwell, vol. 64(3), pages 919-938, July.
    2. Walter Block & William Barnett, 2009. "Coase and Bertrand on lighthouses," Public Choice, Springer, vol. 140(1), pages 1-13, July.
    3. Michael Litschka & Kristoffel Grechenig, 2010. "Law by human intent or evolution? Some remarks on the Austrian school of economics’ role in the development of law and economics," European Journal of Law and Economics, Springer, vol. 29(1), pages 57-79, February.
    4. Simon Deakin & Stephen Pratten, 1999. "Reinventing the Market? Competition and Regulatory Change in Broadcasting," Working Papers wp134, Centre for Business Research, University of Cambridge.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pavel Pelikán, 2010. "The Government Economic Agenda in a Society of Unequally Rational Individuals," Kyklos, Wiley Blackwell, vol. 63(2), pages 231-255, May.
    2. Pelikan, Pavel, 1986. "How Do New Technologies Fare under Different Institutional Rules?," Working Paper Series 169, Research Institute of Industrial Economics.
    3. Pelikan, Pavel, 2008. "The government economic agenda in a society of unequally rational individuals," MPRA Paper 19127, University Library of Munich, Germany, revised 06 Dec 2009.
    4. Timothy P. Roth, 2014. "Economists and the State," Books, Edward Elgar Publishing, number 15078.
    5. Pelikan, Pavel, 1985. "Private Enterprise vs. Government Control: An Organizationally Dynamic Comparison," Working Paper Series 137, Research Institute of Industrial Economics.
    6. Genschel, Philipp, 1995. "Standards in der Informationstechnik: Institutioneller Wandel in der internationalen Standardisierung," Schriften aus dem Max-Planck-Institut für Gesellschaftsforschung Köln, Max Planck Institute for the Study of Societies, volume 22, number 22.
    7. Pelikan, Pavel, 1988. "Economic Competence as a Scarce Resource: An Essay on the Limits of Neoclassical Economics and the Need for an Evolutionary Theory," Working Paper Series 191, Research Institute of Industrial Economics.
    8. Paavola, Jouni & Adger, W. Neil, 2005. "Institutional ecological economics," Ecological Economics, Elsevier, vol. 53(3), pages 353-368, May.
    9. Bruno S. Frey & Beat Gygi, 1988. "Die Fairness von Preisen," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 124(IV), pages 519-541, December.
    10. Tan Ngoc Vu & Duc Hong Vo & Michael McAleer, 2019. "Rent seeking for export licenses: Application to the Vietnam rice market," Documentos de Trabajo del ICAE 2019-13, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales, Instituto Complutense de Análisis Económico.
    11. Hahn Robert, 2010. "Designing Smarter Regulation with Improved Benefit-Cost Analysis," Journal of Benefit-Cost Analysis, De Gruyter, vol. 1(1), pages 1-19, July.
    12. Jieming Zhu, 2005. "A Transitional Institution for the Emerging Land Market in Urban China," Urban Studies, Urban Studies Journal Limited, vol. 42(8), pages 1369-1390, July.
    13. Sophie Bienenstock, 2019. "The Deterrent Effect of French Liability Law: the Example of Abusive Contract Terms," Post-Print hal-03222207, HAL.
    14. Peter Wheale & David Hinton, 2007. "Ethical consumers in search of markets," Business Strategy and the Environment, Wiley Blackwell, vol. 16(4), pages 302-315, May.
    15. Kim, Jongwook & Mahoney, Joseph T., 2008. "A Strategic Theory of the Firm as a Nexus of Incomplete Contracts: A Property Rights Approach," Working Papers 08-0108, University of Illinois at Urbana-Champaign, College of Business.
    16. Christoph Engel, 2006. "The Difficult Reception of Rigorous Descriptive Social Science in the Law," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2006_1, Max Planck Institute for Research on Collective Goods.
    17. Richard Langlois, 2013. "The Institutional Revolution: A review essay," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 26(4), pages 383-395, December.
    18. Randall Morck & Lloyd Steier, 2005. "The Global History of Corporate Governance: An Introduction," NBER Chapters, in: A History of Corporate Governance around the World: Family Business Groups to Professional Managers, pages 1-64, National Bureau of Economic Research, Inc.
    19. Esser, Hartmut, 2005. "Rationalität und Bindung : das Modell der Frame-Selektion und die Erklärung des normativen Handelns," Papers 05-16, Sonderforschungsbreich 504.
    20. repec:dgr:rugsom:97b05 is not listed on IDEAS
    21. Ludwig van den Hauwe, 2005. "Public Choice, Constitutional Political Economy and Law and Economics," Method and Hist of Econ Thought 0508001, University Library of Munich, Germany, revised 09 Aug 2005.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:jeehcn:v:7:y:1996:i:1:n:2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.