Macroeconomic Analysis of Law versus Law and Macroeconomics
Journal of Law and Contemporary Problems Vol. 83, Forthcoming
20 Pages Posted: 31 Mar 2020
Date Written: February 14, 2020
Efforts to conjoin the disciplines of law and macroeconomics raise two main challenges. The first is choosing the specific macroeconomic framework that is to be employed, since there are conflicting possibilities. This is an exercise in economic analysis of law because the difficulty lies in the realm of economics proper. I clarify the problem by examining literature that explores different macroeconomic viewpoints toward the law. The second challenge is reconciling government rule-breaking — a common practice in times of economic turmoil — with deference to the rule of law, which should be everlasting. This is an effort in law and economics, since the focus lies on the interplay between economics and law. I respond by developing the “elasticity” paradigm in law and macroeconomics, a compromise between ex ante concerns with improving the rules of the game and the recognition that the preservation of certain games may depend upon their occasional subversion.
Keywords: Law and Macroeconomics, Rule of Law, Rule-Breaking
JEL Classification: K0, K290, K400
Suggested Citation: Suggested Citation