The Illusion of Law: The Legitimating Schemas of Modern Policy and Corporate Law
Ron C. Chen
U.S. 2nd Circuit
Jon D. Hanson
Harvard Law School
Michigan Law Review, Vol. 103, p. 1, 2004
This Article is about some of the schemas and scripts that form and define our lives. It is about the knowledge structures that shape how we view the world and how we understand the limitless information with which we are always confronted.
This Article is also about the "evolution of ideas" underlying corporate law and all of modern policymaking. It is about the ways in which schemas and scripts have influenced how policy theorists, policymakers, lawyers, and many others (particularly in the West) understand and approach policymaking generally and corporate law specifically. It is about both the invisibility and blinding effect of those schemas. It is about the battle over those schemas and the prizes of victory. And, finally, it is about how the now-dominant schemas render us the "unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades."
We begin our discussion in Part II with the dominant knowledge structures underlying modern policymaking, describing the emergence of what we term the "meta script" of policymaking - or the schemas that frame our approach to policy analysis today. Part III turns to the law regulating large commercial interests - specifically, corporate law - and examines the emergence and dominance of the new "macro script" of corporate law. It examines the schemas that identify and legitimate the purpose of the law. Parts IV and V highlight the signs of illusion in those schemas and then begin to unveil the situational magician behind those illusions. Corporate law works, as all illusions work, by relying on a set of schemas that guide our attention and inferences and play into our intuitions and motives. Yet the outcome and response that this Article suggests is neither so benign nor light-hearted as that of a magic show. While its analysis is concentrated on corporate law, the Article's implications reach each of us, from law student to legal scholar, citizen to policymaker, and reveal something unsettling: all of us are susceptible to schematic sleight-of-hand, tricks that render us vulnerable to dangerous illusion. Where many have heretofore tended to see magic, this Article reveals the illusion of law and some of the unseen mechanisms that make it possible.
This project's larger ambition, it should be noted, is not to encourage disillusionment with the purported goals of the law, but to provide insights that help tailor our means and to narrow the gap between our ends and our outcomes.
Number of Pages in PDF File: 149
Keywords: Schemas, Knowledge Structures, Corporate Law, Shareholder Primacy, Profits, Policy Scripts, Corporations
Date posted: February 26, 2007