Between freedom and paternalism: an economic analysis of fundamental rights and the limits of public intervention

Economic analysis perceives fundamental rights as tools for reducing costs. Rights correspond to private and public “goods†to cover various human needs. Balancing rights relies on the comparison of the opportunity costs for protecting them, while restricting them is a means for the legal order to redress negative externalities and to avoid the abuse of scarce resources. The true “value†of rights depends considerably on the quality of the institutions that protect them. Beyond rights, the Constitution sets the “systemic†boundaries between private and public action (Demos and Agora). Traditional public law in Europe has shaped an “agoraphobic†State which ignored the role of the markets and organized socially important services as monopolies. On the contrary, the EU opts for a market-oriented organization of all economic activities; the State shall guarantee social welfare mainly as regulator and not as provider of services.