On the Past and Future of Law and Economics: Civilian Pedigree, Methodological Challenges, and the Future Relevance of Michael Trebilcock’s Contribution

Abstract

Michael Trebilcock’s article in this issue discusses the past and the future of law and economics (L&E) in Canada. In this article, I attempt to engage with and expand on Michael’s analysis. I start by discussing the transatlantic differences in the past academic and judicial reception of L&E. I contend that no methodological impediment prevents the civil law legal system from being fully receptive to the insights of economic analysis of law. I then identify three methodological challenges confronting L&E in the future and contend that in each of these respects Michael Trebilcock’s approach to L&E is methodologically more compelling than the current prevailing approach. First, Michael’s work is uniquely characterized by the systematic attempt to incorporate value pluralism into legal economic analysis, thereby enriching, correcting, and refining the analytical insights provided by conventional L&E. Second, Michael properly treats institutional pluralism as endogenous to the L&E analytical framework, thereby appropriately shifting the focus from assessing policy outcomes against idealized efficiency considerations to examining the institutional processes of seeking a desirable matching of available instruments and objectives. Third, while in Michael’s work, empirical analysis plays a role in testing descriptive hypotheses about the behavioral impact of legal rules and doctrines, it does not alone guide the definition of the normative content of the law, thereby avoiding the perils associated with the empirical reductionism emerging in the field.

Keywords: Law and Economics, Empirical Legal Studies, Natural law, Legal Efficiency, Legal Positivism, Social Norms

JEL Classification: K10