The Syndrome of the Efficiency of the Common Law
Nuno M. Garoupa
Texas A&M University School of Law; Catholic University of Portugal (UCP) - Católica Global School of Law
Carlos Gómez Ligüerre
Universitat Pompeu Fabra - Department of Law
September 8, 2010
Boston University International Law Journal, Vol. 29, No. 2, 2011
U Illinois Law & Economics Research Paper No. LE10-024
Illinois Public Law Research Paper No. 10-23
Our paper is a methodological critique of the recent legal origins literature. We start by showing that the legal origins cannot be easily based on the efficiency hypothesis of the common law. By debunking the relationship between the efficiency hypothesis of the common law and the legal origins literature, we are left with no consistent theory to explain the alleged inferiority of French civil law.
It is clear that the legal origins literature is based on a particular biased selection of “cherry-picked” legal doctrines. A different selection of “cherry-picked” legal doctrines produces a distinct assessment. We discuss examples that look at substantive law and procedure in the core areas of property, contracts and torts. These are the areas that have been documented to be crucial for economic growth. The second set of examples look at the organization of the legal system and governance. The influence of these variables on economic growth is more controversial, but they have been part of the argument against the efficiency of French civil law. We argue that a careful examination of rules and legal institutions shows that the inefficiency hypothesis of French law is not sustainable under the current framework of comparative law and economics.
Our goal is not to argue that French law is more efficient than common law. Our criticism is essentially methodological. Robust micro-based assessments of rules and legal institutions should prevail over macro generalizations and “cherry-picking” theories that lack a serious theoretical framework. The academic discussion concerning the efficiency superiority of the common law should not overcome the detailed study of legal institutions around the world. Successful legal reforms need to address local problems under local restrictions and specific determinants. In our view, legal reforms based on misperceptions and generalizations are actually detrimental.
Number of Pages in PDF File: 52
Date posted: September 9, 2010 ; Last revised: March 13, 2011