Piercing Pareto Superiority: Real People and the Obligations of Legal Theory

Abstract:     
This essay has two purposes. The first is to demonstrate that the appearance of mutual assent and Pareto Superiority are weak bases for enforcing agreements. Pareto Superiority, as unassailable as it may seem, is paper-thin and frequently based on illusions and a normatively meaningless assessment of what it means to be better off. The approach here is one of piercing Pareto Superiority in order to examine the human factors that may determine whether an agreement occurs and its distributive consequences. Relative deprivation is the instrument used. The second purpose is to suggest that it is the obligation of legal theory to take greater account of the psychological and social factors that influence the process of agreement.

Number of Pages in PDF File: 15

Keywords: Pareto, deprivation, assent

JEL Classification: A14, B25, D63, K29

Accepted Paper Series