The Fallacy of Legal Certainty: Why Vague Legal Standards May Be Better for Capitalism and Liberalism

Abstract

It is often claimed that legal rules framed in clear and unambiguous language are essential for capitalism and liberalism, because they allow for the certainty and predictability that these systems of economic and social organization require. This paper argues that these claims are mistaken, and that the certainty we actually care about is often better-achieved by vague and indeterminate legal standards. The mistake consists in identifying people’s ability to predict the consequences of their actions with lawyers’ ability to predict the consequences of applying the law. But rules that are very predictable in application can produce surprising results for those whose actions they govern. Legal rules exist side-by-side many other social norms that are often more influential than the law in shaping people’s expectations; and these non-legal norms are often couched in vague and indeterminate terms that are not reducible to bright-line rules. As a result, vague and indeterminate legal standards would often better track the actual expectations and predictions of people. This realization should have important consequences for the work of legislatures, lawyers, and judges, who too often assume that vague standards should be avoided because of the uncertainty they entail.

Keywords: legal theory, jurisprudence, legal certainty, rules and standards, capitalism, liberalism, democracy, textualism