The Concept of Perfect Competition as the Law of Economics: Addressing the Homonymy Problem
University of Stirling, School of Law
February 8, 2012
Northern Ireland Legal Quarterly, Vol. 62, No. 4, pp. 523-538, 2011
The rapid expansion of economic analysis is visible in many areas of law. In some of them – in antitrust in particular – economic reasoning is already perceived as the dominant discourse. This article is an attempt to contemplate a reverse analysis. Instead of addressing the legal domain from the perspective of economics, it tries to explore the economic discipline through the lens of a lawyer. The analysis is directed at one of the main principles of neoclassical economics – the concept of perfect competition: partly to explore its constitutive role in economic reasoning, but also in order to articulate the misconception with which some economists approach legal regulation of economic relations.
I presume that the concept of 'perfect competition' is often intuitively confused with that of 'competitive process'. These are two independent concepts, but both are called 'competition', which causes an epistemic confusion and leads to important normative consequences. In the last section I revert to the communicative problems between law and economics, concluding that true interdisciplinarity means understanding the language of the other discipline rather than developing an uncritical Esperanto which is sometimes the case with the rapid proliferation of the 'more economic approach' in contemporary antitrust discourse.
Number of Pages in PDF File: 16
Keywords: competitive process, perfect competition, law and economics, interdisciplinarity
Date posted: February 8, 2012