Gresham's Law in Legal Education

43 Pages Posted: 30 Jul 2008

See all articles by Steven R. Smith

Steven R. Smith

California Western School of Law

Date Written: July 16, 2008


Legal education can learn important lessons from Gresham's Law. (That law is informally stated as "bad, or debased, money tends to drive good, or full value, money out of circulation.") When the intrinsic value of something can be separated from the nominal value, as is true with money and law degrees, some people will seek the benefits of the nominal value without "paying the cost" of the intrinsic value. A nominal value of the law degree is the ability to take the bar exam or be licensed; the intrinsic value is the education and skills expected of one who has the degree. In turn, such a separation of values can put pressure on "good" education to compete with debased education, since both carry the same nominal value for licensing. Accreditation can serve the purpose of ensuring that the nominal value of a law degree reflects true educational value and the accreditation Standards of the ABA should be directed toward that end. Because the ABA intentionally ties its accreditation to licensure, its touchstone should be the public interest served by licensure. The Standards can be justified only if they contribute to this interest in an effective and efficient way. The AALS membership process, on the other hand, has other goals and some of its membership requirements are legitimately directed to academic and faculty interests.

Keywords: law schools, accreditation, ABA standards

JEL Classification: K0, K10

Suggested Citation

Smith, Steven R., Gresham's Law in Legal Education (July 16, 2008). Journal of Contemporary Legal Issues, Vol. 17, 2008, San Diego Legal Studies Paper No. 08-039, Available at SSRN:

Steven R. Smith (Contact Author)

California Western School of Law ( email )

225 Cedar Street
San Diego, CA 92101
United States

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