Law as a Network Standard
14 Pages Posted: 5 Apr 2005
The problem of global information flows via computer networks can be conceived and understood as raising issues of competition, interoperability, and standard-setting parallel to those in analysis of technical standards. Uniform standards, whether technical or legal, give rise to a constellation of positive and negative network effects. As a global network based upon the "end to end" principle of interoperability, the Internet mediates between different, otherwise incompatible computing platforms. But to the extent that law and technological "code" may act as substitutes in shaping human behavior, the Internet similarly mediates between different, otherwise incompatible legal platforms. Much of the legal and social controversy surrounding the Internet stems from the interconnection of such incompatible legal systems. As with technical systems, problems of incompatibility may be addressed by the adoption of uniform legal standards. This, however, raises legal standard-setting problems similar to those seen in technical standard-setting, where the standard may be "tipped" in favor of dominant producers. In particular, if law is considered a social product, the benefits of interjurisdictional competition and diversity may be lost as a single uniform legal standard dominates the market for law.
Keywords: law, network effects, Tiebout, race to the bottom, standard-setting, Internet
JEL Classification: H41, F02, F13, L86, O31, O32, O33, O34, O38
Suggested Citation: Suggested Citation